What does life insurance cover and how does it work?

Life insurance is a contract that is carried out between an insurance company and the insured to establish a sum of money that will be paid to the beneficiary of the policy in the event of the death of the insured person. The calculation of the price of the premium and the amount to be paid to the beneficiary is variable and takes into account, among other aspects, the insured’s profile, age and the amount to be insured.

In the event of total or absolute permanent disability , the insured will receive all the insured capital as long as the disability is caused by illness or accident. Events caused by the recklessness of the insured or intentionally are some of the circumstances that would not be covered by life insurance.

As you can see, life insurance not only works as financial support for the insured’s relatives in the event that this is needed one day, but it also protects them against unexpected situations that could prevent them from carrying out their professional activity.

 

The basic coverage of life insurance is the risk of death of the policyholder for any cause: natural death, illness, accident, etc. There are other risks that could cause disability or death from causes that are not usually included in a basic policy, so it is essential that the person who is going to take out life insurance think carefully about the situations to which they are exposed in their day to day.

Life insurance coverage is limited to that contracted by the policyholder himself, however, there are a series of circumstances that these products do not include within the coverage and guarantees.

Suicide is one of the situations that are not covered by life insurance. Likewise, gross negligence or reckless acts are penalized. An example would be that of a person who dies due to driving under the intake of narcotics.

Other situations in which the insured company would not pay the agreed amount if the insured dies would be:

• Acts that imply military or civil confrontations.
• Sports with a certain degree of risk such as car racing or mountaineering.
• Accidents caused by natural phenomena such as volcanic eruptions, earthquakes or floods.
• Death caused by a beneficiary intentionally.

Non-traumatic pathologies (strokes or heart attacks), not paying the premiums up to date or not having declared a health problem at the time of filling out the questionnaire, are other reasons why the insurer could refuse to pay compensation to the beneficiaries of the policy.

 

At Allianz we make available to our clients different life insurance policies that cover different types of risks.

It is the fundamental life policy. It mainly covers death and burial expenses. It is ideal for people looking to leave their children or dependents protected in the event of death.

In addition to covering death, it also includes absolute permanent disability to guarantee the quality of life of the insured if he were to become unable to work and generate income.

It is indicated to cover accidents. Although the most basic coverage is the death of the holder, it allows opting for other guarantees that cover death by accident or serious illness.

It is the most complete policy that protects the insured against serious illnesses. Among other services, it offers a second medical opinion and health guidance 24 hours a day.

It is the modality indicated for the self-employed or professionals with highly qualified jobs. It covers death, absolute permanent disability and total permanent disability. It also offers family help for orphans or illness.

The most complete coverage and guarantees are offered by this insurance. It covers serious illness, death, death due to an accident, death due to a traffic accident, disability due to an accident, disability due to a traffic accident and absolute permanent disability.

In the event that in the future you could not meet the mortgage obligations contracted with a bank due to death or disability, this type of policy ensures the economic stability of your relatives, since it covers mortgage loans and personal loans.

Each company has different life insurance. Regardless of which one you plan to choose, we recommend that you take into account the coverage of your insurance, but especially the clauses, since not having them clearly can lead you to contract additional coverage. If you have any questions or want more information about life insurance,  leave us your information
and one of our advisors will contact you to resolve any concerns.