The Insurance Industry
The global insurance industry helps policyholders to shield themselves from potential risks, and covers everything from property protection to vehicle, medical, health and life insurance.
The insurance industry is one of the most important financial services industries in the world. There are two broad sub-divisions of the insurance industry – the life insurance industry and the general insurance industry.
The life insurance industry has been established to help dependents survive the loss of the family breadwinner. There are five main types of life insurance:
1.Term Insurance. Insurance is provided for a specific term, such as 30 years. If the policyholder dies during that period, a pre-specified amount of money is paid to the beneficiaries. If they are still alive at the end of the period, no money is paid out. There is no investment component.
2.Whole Life Insurance. A form of term insurance in which the policy is in effect for the entire duration of the policyholder’s life, not for a specified term.
3.Universal Life Insurance. Includes a cash account component. Any monthly amount paid in that is above the minimum premium will be invested and will grow in value during the term of the policy. At the end of the term the surrender value is the size of the investment in the cash account, minus any charges applicable, and this amount is paid to the policyholder. If the policyholder dies during the term then the beneficiaries receive the death benefits.
4.Variable Life Insurance. Similar to universal life insurance, except that the cash account is managed by the policyholder, who can decide where to invest the additional funds. They are normally invested into mutual funds or unit trusts.
5.Endowment Policies. These are insurance policies in which a lump sum is paid out at the end of the pre-specified term, or when the policyholder dies if that is during the term of the policy. Traditional With Profit Endowment Policies pay out a minimum specific sum, the sum assured. This amount can be increased through investment performance. Since this policy type has additional benefits, it carries higher premium costs.
The general insurance industry consists of all the available forms of insurance, other than life insurance. This includes a number of well known industries such as vehicle insurance, , home and content insurance, disability insurance, travel insurance, term insurance, medical insurance, dental insurance, keyman insurance, renters insurance, farmer insurance and general insurance.
Some very important terms in the context of the insurance industry are insurance benefits, insurance broker, insurance rating, insurance quote, insurance policy, insurance company, insurance coverage, insurance premium, insurance claim, insurance rates, insurance agent and insurance risk.
There are numerous countries with flourishing insurance industries of their own. In Asia, countries like
In Europe, the insurance scenario is stable in
In North and South America, the insurance industry is exceptionally strong, as it is in
The leading global insurance companies are:
Labels: global insurance, insurance company, insurance industry, leading global insurance company, term insurance, Whole Life Insurance
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