The Procedures of Affecting a Life Assurance
1.Submission of proposal from2.Submission of agent's report
3.Doctor's report
4.Certificate of age
5.Acceptnce of the proposal
6.Payment of the first premium
How Life Assurance Policy Becomes Inactive
If owner fails to pay the premium,when its due or if owners submit any fraudment application,Life assurance policy become inactive and any such inactivation must occur within a period of time (usually 2 years) defined by law then only the insured can obtain one of the following remedies;1.Obtain the paid up value
2.Obtain the surrender value.
Paid up value is use to purchase an amount of coverage where no further premiums are paid into it.Thus it becomes a paid up policy. In other words when a policy is taken out,it is taken out with an agreed sum assured.If you allow your policy to laps due to the stopping of premium payments,then the sum assured is reduced to give you a lower value the reduced sum assured is paid up value.
Obtain the Surrender Value
The amount the policy holder will get you from the life insurance company If he decides to exit the policy before maturing.The insured can obtain certain % of payment (premium) paid by him up to the date of termination.In order to obtain surrender value,the policies which are taken for less than 10 years should have paid their premium continuously for 2 years and policies with more than 10 years Should have paid their premium at least for 3 years.Which Insurance Principles are not applied in life assurance?
- Indemnity
- Contribution
- Subrogation
- Name of the insured and address
- Type of risk
- Value of the insurance and time duration
- Health condition of insured
- Personal habits
- Details about family
- Occupation of the insured
- History of the insured
- Losses of history
- Risk of the occupation(job) and risk of life
- Value of insurance policy
- Time of maturity
- Age of insured
- Coverages
- Personal habits
- Current and past health.
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