How do the insurance companies operate?
The life insurance company or the insurer calculates the policy prices according to mortality table, the premiums collected from the policyholders will pay for the overhead and administrative costs, and invest the money to create a pool of money to pay claims. The premiums alone normally not sufficient to cover claims and expenses, the life insurance company makes profit from investment. Glossary of insurance Accidental death benefit – this is the amount payable to the beneficiary if the insured’s death is the direct result of an accident. Age of issue – the insured’s age at the time the life insurance coverage takes effect. Annuity – a contract sold by life insurance companies to provide fixed payments on an investment to the policyholder for a life time or for a certain number of years, usually after retirement. Assignment – the act of transferring all or part of the life insurance benefit to another person. Automatic premium loan (provision) – if the buyer does not pay his premium w
