Life insurance.

Life insurance is a type of insurance that compensates

beneficiaries upon the death or the policyholder_ The company will guarantee
a payout tbr the beneficiaries in exchange of premiums_ This compensation is
called "'death benefit." Depending on the type of insurance one may have.
these events can anything from retirement_ to major injuries_ to critical illness
or even to death.
The followinv are common risk categories:
1. Preferred Plus -The policyholder is in excellent health_ With normal
weight no history of smoking. chronic illnesses, or family history of any life-
threatening disease_
2_ Preferred - The policyholder is in excellent health but may have minor
issues on cholesterol or blood pressure but under con trol.
3:Standard Plus - The policyholder is in very good health but some factors,
like high blood pressure or being overweight impede a better rating_
4.Standard- Most policyholders belong to this category, as they are deemed to
be healthy and have a normal life expectancy although. they may have a
family history of life-threatening diseases or few minor health issues_
5.Substandard — Those with serious health issues_ like diabetes or heart
disease are placed on a table rating system, ranked from highest to lowest. On
average_ the premiums will he similar to Standard with an additional 25%
lower claim on table ratings.
6. Smokers - Due to an added risk of smoking, the policyholders this
category are guaranteed to pay more_ Aside from health age is also a critical
factor in determininR premiums.

Benefits of Life Insurance

The following are the benefits of life insurance_

1 It pays for medical and funeral costs_ Life insurance helps the incurred
expenses for medical and funeral services to I the grief among family and
relatives for being unprepared_

2_ For financial support Life insurance can become a source temporary

income during the difficult period of adjusting coping with the loss of a loved
one, especially if heishe is die breadwinner_
3.For funding various financial Roals. Life insurance additional benefits
through the form of fund accumulation for specific future financial goal&
4_ Acts as a retirement secured conform_ Modern life insurance also serves as
a tool that principal holders can use to get in a better financial position in the
future_

5_ It covers costs incurred from taxes and debt Life insurance can serve as
protection since (he premium can be used to pay for unsettled debts and taxes_
Types of Life 'Insurance
The table below shows a comparative analysis of different types of life insurance
along characteristics, advantages and disadvantages that may serve as a reference.