Survival insurance: features, types, advantages and disadvantages of insurance programs, policy, payment.
Among the many insurance products offered to the public today, life insurance programs stand out. Middle-aged and elderly people often hear about such a service, but so far not everyone understands its essence.
In the article we will consider survival insurance with all the nuances, advantages and disadvantages.
Survival Insurance: Features
The essence of the program is the accumulation of funds by the policyholder until an insured event occurs. The insurant’s contributions are kept in a special account, they are charged certain interest, which will also be paid under the survival insurance contract.
The main feature of the program is that the accumulated money can be paid in two cases:
- After the expiration of the policy – the full amount is paid with accrued interest.
- After the death of the insured – the entire amount is paid to the beneficiary, who was indicated in the application (if such a person is not declared, then to the heir).
The survival insurance contract can be concluded for a group of people or members of the same family who will use the insurance product together. The policyholder does not have to be the insured person. For example, an adult son can issue a policy for his mother or grandfather.
When surviving insurance, the state of human health is necessarily taken into account. Filling out the questionnaire, he must answer a number of questions regarding his physical problems, chronic diseases.
Based on this information, an individual program will be formed for this person and the amount of contributions calculated.
In cases where the client insists on a very high amount or a long insurance period, a medical examination may be required. So the insurer minimizes the risk of concluding a contract in relation to terminal patients.
One option for surviving insurance is a death benefit plan.
According to the conditions, the client makes annual payments, and after the death of the insured receives the amount indicated in the policy. If this does not happen during the insurance period, all the money paid earlier will go to the issuing company.
A specific feature of term insurance is that the amount indicated in the policy upon death is paid to the beneficiary in full, regardless of the number of contributions made earlier.
Such an agreement can be concluded for any period from a year to 20 years, but on condition that a person is insured no older than 65-70 years. The sum insured is set individually.
The recipient of compensation must present a document stating the cause of death of the insured. Not all reasons are accepted as the basis for the payment of money.
The insurer has the right to refuse to pay if:
- it was an act of suicide
- it was a consequence of a chronic disease that was hidden upon receipt of the policy,
- it was a deliberate action to get insurance.
This option involves the beneficiary receiving the accumulated amount after the death of the person specified in the policy. Under the terms of the contract, he must make a one-time contribution or make regular payments over a specific period of time.
If the insured person survives to the age specified in the contract, the amount will be transferred to the beneficiary.
The peculiarity of the lifelong program is that it acts like a bank deposit: how much is accumulated, including interest, so much is paid.
This type of insurance differs from the previous one in the absence of restrictions on health and age. The contract is concluded with people of any age, and they should not declare the presence of any diseases.
The application has a standard form, without special applications. After issuing the policy, an account is opened in the name of the policyholder, where he will deposit the money.
Advantages and disadvantages
When choosing a survival insurance, it is important to clearly understand the advantages and disadvantages of the programs offered today.
Among the advantages of this choice, it is worth noting the following:
- A funded scheme helps save money for yourself or your family.
- Any person can become a beneficiary, regardless of kinship, inheritance rights or other factors.
- Upon death or expiration of the policy, payment is made as soon as possible after the submission of the application and the necessary documents (confirmation of the causes of death).
- It is possible to choose any insurance period – from 12 months to 20 years.
- Anyone can insure a relative, loved one.
- Compensation can be obtained in case of injury, accident.
Survival insurance is not so perfect, it has some disadvantages.
- age restrictions (persons 75 years of age and older are not insured),
- restrictions due to poor health,
- the opportunity to lose the entire amount if the insured event does not occur before the end of the insurance period.
All of the listed disadvantages do not apply to life insurance. Everything is simpler and more accessible here. The contract can be concluded by a person of any age, the presence of health problems does not play a role.
A person simply invests in a personal account, and then receives the full amount with interest.
Among the advantages of life insurance are the following:
- The terms of the contract can be changed at any time by writing a statement in the insurer’s office.
- Money can be invested and saved in an account in any convenient currency.
- The contract can be terminated ahead of schedule, while the accumulated funds will be returned.
- For the longest possible period, the policyholder can accumulate a substantial amount due to accrued interest.
The price of the policy is calculated according to the tariff, which may vary in different companies.
The tariff schedule is compiled taking into account several important factors that can increase or decrease insurance risks:
- the current demographic situation in the region,
- place of work, the presence of harmful working conditions,
- gender and age, state of health,
- insurance conditions, term, amount of the sum insured and others.
To find out the exact cost of the service, it is better to contact the insurer. After receiving the necessary information and, if necessary, conducting a medical examination, he will name the final amount.
For example, if you want to insure your grandfather aged 70 years and assign a payment amount of 1 million rubles, then each month you will have to transfer 500-800 rubles. If a pensioner finds a chronic disease or continues to work in hazardous work, the monthly contribution will increase and can reach 15 thousand rubles.
According to statistics, such a policy on average costs 30 thousand rubles a year.
Registration of the policy and payment of savings
To purchase a policy, a client must write an application.
He will also have to fill out a special application and provide the following information for the past 5 years:
- the presence of disability
- the presence of cardiovascular, neurological diseases,
- the presence of cancer problems,
- hospitalization for more than 10 days,
- temporary disability longer than 1 month.
Do not hide the presence of diseases, otherwise the insurer may subsequently be paid a refund. After the occurrence of the insured event, the beneficiary must present to the insurer documents where the cause of death will be indicated.
If discrepancies with the data that he indicated earlier are revealed, he will not receive money.
To apply for the policy, an applicant’s passport will be required; in some cases, the insurer requires a certificate of medical examination. If the client wants to insure another person, both passports must be provided.
Before signing the contract, it is recommended to study the conditions and clarify all the nuances in order to avoid misunderstandings in the future. After the entry into force of the document, the policyholder is required to make contributions in accordance with the agreed conditions.
If the insured person dies during the policy period, the beneficiary must come to the insurer with the following documents:
- a statement indicating the number of the contract and the date of signing,
- the original policy
- death certificate
- certificate of causes of death,
- own passport
- documents confirming the right of inheritance, if the beneficiary is not indicated in the contract.
An insurance program in case of death or survival is an opportunity to accumulate funds that are useful in case of loss of a bread-winner in a family, a close person, a relative. Cash compensation paid by the insurer will help family members cope with material losses in a difficult situation.