Types Of Insurance
Generally, Indonesia, two (2) types of insurance, the insurance is traditional insurance and non-traditional. Let us refer to further discussion.
Definition of life insurance (life insurance policy) policies by definition LOMA (Life Office Management Association) is:
"Life insurance policy (life insurance) is a policy in the policy where the insurer agrees to pay benefits for the death of the insured / insured."
Traditional insurance also has a variety of types, each of which will be explained as follows:
1. Life insurance (long-term)
Term insurance provides protection in a limited time. Protection can be as short trip tickets between Jakarta and Semarang for less than two hours or as long as 20 years. Typically, there is a period of insurance coverage. In addition, if there is no risk, the insurance money is not returned or canceled.
This type of insurance is the cheapest among the other insurance premiums. The cover can be a lot of money, billions of premiums are not too breaking the bank. Type of term life insurance has no cash value. If, on the expiry of always healthy insurance contract the insured, unless the contract expires and no money is given to the insured.
2. Any life insurance (whole life)
This insurance contains the value of savings. The protection period longer, up to 99 years. This insurance is called a refinement of term life insurance that has no cash value. However, the value of premiums that must be paid to the customer is also more expensive than term life insurance.
In whole life insurance when the contract expires and the insured is still alive, no cash value provided to customers. The redemption value of the whole life policy can be used as collateral for loans, and there is a bonus dividend of the Company for all policyholders of life. Also, if she can not pay the premium, the insured can withdraw funds from the cash value. This function does not exist on the type of term life insurance.
3. Endowment insurance (staffing)
The third type is the traditional endowment insurance. This guy is like a long-term insurance and savings. The diversity of forms of endowment insurance. In addition to the cash value, there are also funds expended prior to the expiration of the term of the insurance contract. These funds periodically, eg every 3 or 5 years.
For example, as Education issued the insurance fund when the child was 5 years for kindergarten entry fee, 7 years of fees in primary school and so on. Unfortunately, this endowment insurance premiums are much more expensive than insurance premiums in the long term and whole life.
Non-traditional type of insurance is only one link unit. In addition to functioning as a protection, it also serves as an investment. Premiums paid partly used to finance the protection and partly placed in units of mutual funds in the form of links.
The insured will be asked to choose where to place their investments, whether in equity funds, balanced mutual fund investment funds fixed income or money market.
For the type of unit-linked insurance is quite complicated and difficult to understand. While potential customers should really pay attention and deepen.