Life insurance: back to basics

Life insurance: a piece of history

The modern insurance contracts that we have today, like life insurance, originated in the practice of merchants in the 14th century. It has also been recognized that different types of security agreements have already been in force since time immemorial and are somewhat similar to insurance contracts in their embryonic form.

The phenomenal growth of life insurance from almost nothing a hundred years ago to its gigantic current ratio is not one of the outstanding wonders of commercial life today. Essentially, life insurance became one of humanity's felt needs due to the relentless demand for economic security, the growing need for social stability, and the clamor for protection against the dangers of cruel and devastating calamities and crises. sudden economic. Insurance is no longer a rich man's monopoly. Gone are the days when only the social elite had their protection because in this modern era, insurance contracts are plagued by the assured hopes of many families of modest means. It is interwoven, so to speak, in the same corner of the national economy. It touches the most sacred and sacred ties in the life of man. Parental love. The love of wives. The love of children. And even love of business.

Life insurance as financial protectio

A life insurance policy pays an agreed amount generally known as the sum insured under certain circumstances. The sum insured in a life insurance policy is intended to meet your financial needs, as well as your dependents in the event of death or disability. Therefore, life insurance offers financial coverage or protection against these risks. https://www.blakeinsurancegroup.com/online-life-insurance-quote/

Life insurance: general concepts

Insurance is a device that distributes risks. Basically, the insurer or insurance company groups the premiums paid by all its clients. Theoretically speaking, the set of premiums is responsible for the losses of each insured.

Life insurance is a contract by which one party insures one person against loss for the death of another. A life insurance is a contract by which the insurer (the insurance company) for a stipulated amount, agrees to pay a certain amount of money if another dies within the time limited by the policy. The payment of the insurance money depends on the loss of life and, in its broadest sense, life insurance includes accident insurance, since life is insured under any contract.

Therefore, the life insurance policy contract is between the policy holder (the insured) and the life insurance company (the insurer). In exchange for this protection or coverage, the policyholder pays a premium for an agreed period of time, depending on the type of policy purchased.

In the same sense, it is important to keep in mind that life insurance is a valued policy. This means that it is not an indemnity contract. The insured person's interest in the life of someone or another person is generally not susceptible of an accurate pecuniary measurement. You simply cannot put a price on a person's life. Therefore, the measure of compensation is what is set in the policy. However, the interest of an insured person becomes susceptible to an accurate pecuniary measurement if it is a case involving a creditor who insures the life of a debtor. In this particular scenario, the interest of the insured creditor is measurable because it is based on the value of the debt.