December 1st, 2010 | 
Author: The most basic life insurance is an annual long-term policy. Each year, the premium is slightly higher than a person ages. Insurance developed a level premium policy, which stopped the increase of annual premiums for the insured. Insurer has substantially all the bonds in the age of 0 to 100, then divided by 100. This means that in the early years of the policy, the insured needs more money to pay the cost of pure insurance financing, then in recent years, the premium is lower than the cost of pure insurance.
The end product itself can be designed for a period of any duration, such as 5, ie the years 10, 20, 25 or 30 The method of calculating the average premium is the same in each case.
However, this new product has caused problems. Insurance companies know that to keep the vast majority of policyholders a policy for life. Therefore, raise the level of term premiums paid subscribers and its political future. Insurance companies were happy because they have learned to keep the money. But over time they developed the concept of salvage value.
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Posted in Insurance | 
Tags: basic life insurance, insurance, insurance companies, insurance financing