Information about the state of health is mandatory requested by the insurer at the agreement conclusion. It is obviously that the younger the person, the less health problems they have and the easier it will be to conclude a life insurance contract. The tariff and risks to be covered will be determined at the agreement conclusion and will remain unchanged throughout the entire period despite the possible occurrence of any diseases. When calculating the tariff, an “average” person with similar initial parameters is taken into account. Depending on the further state of health, the final cost of the risk component of the contract may be higher or lower than with the annual acquisition of similar policies. When concluding a contract for one year, it is necessary to annually confirm the presence or absence of diseases. Serious health issue may be developing for a long time, and at the next policy renewal it will be necessary to reflect them in the application, which may entail the application of a protective tariff or exclusion of some of the risks. Keeping quiet about the existing disease may result in a denial of payment.
Guaranteed annual return on endowment life insurance contracts is standardly insignificant and is usually fixed at around 3%. Return on investment may be additionally accrued depending on the results of the insurer's activities.
By concluding one contract, you get protection from unforeseen situations and fund safety and accumulation. There are no additional time costs for the selection of two counterparties.
If banks offer to place deposits for up to five years, the same term for endowment life insurance contracts is usually minimal. The average term of such agreements is 15 years. The maximum period depends on the age at which the agreement is concluded, as it is usually limited to the age of the insured at the moment the contract ends. During the term of the contract, in the absence of insured events, the only action of the insured is to pay premiums.
If the beneficiary is specified in the contract, in the event of the insured’s death, the insurance payout is made to the beneficiary, and is not included in the inheritance.
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