COST AND

BENEFITS OF
INSURANCE
- KIRTHI NAIR
■ A way of determining the net cost of life insurance to the insured.

■ The total amount the insured gets back from the insurer is deducted from
the total amount the insured has paid to the insurer.

■ The premium rate of life insurance is based on 2 underlying concepts

– Mortality
– Interest
■ A third variable is the expense factor which is the amount the company
adds to the cost of the policy to cover operating costs of selling
insurance, investing the premiums and paying claims
How the cost of life insurance is
determined?
■ MORTALITY

■ INTEREST

■ EXPENSE
 BENEFITS OF INSURANCE
■ Risk cover
■ Planning for life stage needs
■ Protection against rising health expenses
■ Builds a habit of long term savings
■ Safe and profitable long term investment
■ Assured income through annuities
■ Protection plus savings
■ Growth through dividends
■ Facility of loans without affecting the policy benefits
■ Tax benefits
THANK YOU