Recently, more and more often you can hear from the TV screen or from other sources of information about insurance. As for the mandatory part, it’s easier with this (there is no choice: to have a policy or not to have one). But the voluntary part of the possible protections requires greater awareness of citizens in this area. Let's talk about endowment life insurance. About its importance and necessity for everyone.
History
Life insurance began in England in the 18th century. In the next century, this idea was embodied in Germany, France, the USA, and tsarist Russia. The main principles of work are used in the modern world. 90% of Europeans and Americans today are covered by life insurance. In Russia, this indicator is extremely low.
Principle of operation
The principle of insurance as such is simple and straightforward. A person pays an insurance premium (this is a certain amount of money that is paid to an insurance company in order to receive an insurance service). The insured event stipulated by the contract has occurred - the client or his heirs (in case of death of the insured person) receive a certain amount. As for accumulative life insurance, there is both insurance and money saving. Since the insurance premium (insurance premium) is a person’s monetary investment for profit. The company invests clients' money in various financial instruments (real estate, securities, bank deposits, etc.). At the end of the contract, the person is paid the amount of insurance premiums plus investment income. In case of death of the insured before the expiration of the policy, money in the amount of the agreed insurance amount is paid to the beneficiaries (as a rule, these are family members).
Popularity
In Russia, voluntary insurance, in general, a person spends up to 2% of earnings. Whereas in most European countries, citizens take 1/3 of their monthly income. The main reason for the unpopularity, according to insurers, is the ignorance of the population about this product and its subtleties. As a result, the fear that people need to give money for 10 years or more is much higher than the desire to protect themselves and their loved ones, while creating capital for themselves. But still, the life insurance market is developing rapidly. According to the Association of Life Insurers, insurance premiums in 2013 increased by 40.6% compared with 2012. Of these, the indicator of the amount collected for life insurance of citizens has increased by 59.9%. Over the past four years, the market volume has become six times larger.
Children's programs are in demand in Russia. In this case, the insurance premium is the future of the child, which for Russians always remains issue number 1.
Importance
What does a cumulative life insurance program give to a person?
• Financial protection in case of death, disability, various diseases.
• Opportunity for cash savings adjusted for inflation.
• Obtaining investment income.
• Creating capital for the future for yourself with the right to inherit by beneficiaries.
• Creating capital for your children.
Guarantees
Over the past 200 years, not a single life insurance company in the world went bankrupt. This is facilitated by a clear control of their activities by the state and the reinsurance system.
Opportunities
In order for money to always be, you need to be able to properly dispose of it. Even from a small income, you can put aside 10%. To make an insurance premium means to pay first of all to yourself, and then to everyone else for certain benefits. Cash reserve will help in the most important life situations.