Life assurance is a binding contract where a policy holder pledges to an insurer or an underwriter that he will pay an agreed amount of cash each month to an annuity holder, usually an insurance company or an investment company. These are often referred to as cash-value life insurances. It is important to note that unlike life insurance that only covers a specific term, life assurance covers the entire life of the policyholder.
The terms life assurance or guaranteed income policies vary among different companies and can be quite complex. Some of these policies are commonly referred to as life settlement plans and other as premium-only policies. The terms life assurance or guaranteed income plans generally refer to an insurance plan where the premium payable is based on the amount of risk assumed by the insurer in offering the policy. Find out more about life assurance at a site like Cavendish Life Assurance.
A guaranteed income plan may also be referred to as an endowment, which is a combination of a life settlement plan and a traditional insurance policy that pays out the premium on a regular basis, depending on the policyholder’s life expectancy.
Life assurance is an extremely useful form of protection, as it offers several benefits to the insured. In general, insurance plans provide coverage for any financial losses incurred through death, disability, injury, and loss of property. It pays out cash upon death in the form of an annuity or a deferred payment, depending on the policyholder’s age and his/her lifestyle. This allows the insured to enjoy the benefits of income during his lifetime and build wealth that may last his/her entire life.