It is important to understand why life insurance policy is a must and how it works before buying the life insurance plan. In-Depth knowledge of the policy will help you make an informed decision. Also, one must see to it that the policy is purchased from a reliable insurer or not.

As you move down the page, you will get the chance to have a look at how the life insurance policy works.

Payments:

• One must ensure timely payments of the predetermined premium, as mutually decided between the insured and the insurer.

• If the insured does not wants to go with the lump sum amount, he or she can get this amount paid in the form of instalments to the nominee or nominees after her or his demise

• Bonuses can also be paid by the insurer. However, this is based on the amount that has been accumulated over the tenure of the policy.

• The payments of the premium of the policy throughout the policy tenure ensure that the insured’s nominee or nominees will receive the pre-decided lump sum from the insurer if the insured passes away during the policy tenure

Loan against the policy on hospitalization or critical illnesses:

• There are few insurers that offer the option of withdrawing cash against the life insurance policy for certain emergencies. This includes the treatment of critical illnesses or any sort of emergency wherein immediate hospitalization is required.

• Insured also have the flexibility to take a loan by submitting the required documents along with a letter that specifies the reason behind opting for a loan.