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Simple English definitions for legal terms
life policy
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A quick definition of life policy:
A life policy is a type of insurance that pays out money when someone dies. It's like a contract between the person who buys the policy and the insurance company. There are many different types of policies, like ones that cover accidents or ones that cover property damage. Some policies require regular payments, while others only pay out if something specific happens. Insurance companies use a process called rating to decide how much someone should pay for their policy.A more thorough explanation:
A life policy is a type of insurance policy that provides coverage for the policyholder's life. It requires lifetime annual fixed premiums and becomes payable only upon the death of the insured. This policy is also known as a regular life policy.
- Term Policy: A life-insurance policy that gives protection for a specified period, but that does not have a cash value or reserve value.
- Endowment Policy: A life-insurance policy payable at the end of a specified period, if the insured survives that period, or upon the insured's death if death occurs before the end of the period.
- Joint Life Policy: A life-insurance policy that matures and becomes due upon the death of any of those jointly insured.
These examples illustrate different types of life policies that provide coverage for different periods and under different circumstances. They all require the policyholder to pay premiums regularly to keep the policy in force. The policy pays out a benefit upon the occurrence of a specific event, such as the death of the insured or the end of a specified period.