Page 89 - BFSI CHRONICLE 10 th Issue (2nd Annual Issue ) .indd

Edition July 2022
Annual Issue, 10
BFSI Chronicle, 2 Annual Issue, 10 Edition July 2022
BFSI Chronicle, 2
nd
nd
th th
INSURANCE “If I had my way, I would write the word 'insure'
over every door of every cottage and upon the
blotting pad of every public man, because I am

convinced that, for sacrifice that are conceivably
LAWS small, families can be secured against catastrophes
which otherwise would smash them forever.”
– Winston Churchill
Insurance has evolved over a period of decades
and gone are the days when life insurance was
considered more as a savings instrument and
less as a security to the family against the loss
of life of the Breadwinner of the Family. So,
life insurance products which offered maturity
value [technically called “Endowment type
products”] were the insurance plans that were
sold most in yester years. For simplification, we
may broadly categorise life insurance products
into two types, viz., Term Insurance Plans and
Endowment Type Plans. Term Insurance Plans
offer purely risk cover during the chosen term
and if the Insured survives the term of the
insurance cover, nothing will be payable. In
another words, Term Insurance plans do not
have any maturity value to be paid at the end
of the term of the insurance cover. In contrast,
Endowment type plans, offer insurance cover
during the term of the policy and offer maturity
value as well at the end of the term if the Insured
is alive as at the end of the term of the policy.
Obviously, the premium for endowment type
plans is higher than that for Term Insurance
plans.
Not in the very distant past [even today in
some cases], talking about death is a taboo in
a house, more so in rural areas. Generally, life
insurance policy pays money when the insured
person dies. But, no person wants to hear about
his/her own death and this has become a big
CMA Vadapalli Srinivas challenge in canvassing term insurance plans
Head- Legal of one of the Leading Life Insurance which offer only death benefit during the term
Companies in India of the policy. So, traditionally, endowment type

The Institute Of Cost Accountants Of India
The Institute Of Cost Accountants Of India
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