Explain the meaning and elements of Life Insurance.

Explanation

Life insurance is a contract between an insurer and a policyholder in which the insurer guarantees payment of a death benefit to named beneficiaries upon the death of the insured. The insurance company promises a death benefit in consideration of the payment of premium by the insured.



Basic Elements of Life Insurance: -

Primary purpose of Life Insurance is to give financial protection against :

1. Risk of an early death and

2. Risk of living too long

Therefore, all Life Insurance products has two basic elements :

1. Death cover and

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