Kathmandu. One of the most important questions about why to buy life insurance is still found in many ways in Nepali society. Many people do not understand insurance, even those who understand it are incomplete. There are still people who think of insurance as a gamble.
Insurance companies are established under the Insurance Act and Company Act of Nepal. They are regulated, monitored and controlled by the Insurance Authority, the autonomous regulatory body of the government. In order to protect the investment of the insured, the regulator has to ensure the amount equal to the liability of the insurance company through capital and savings. Life insurance companies are comparatively safer due to effective regulation and good governance, rather than weak regulation and good governance like cooperatives. The insurance company also reinsurance its liability. As a result, when the insurance company has to pay more compensation than it can afford, the insurance company claims the amount from the reinsurance company and pays the insured.
Insurance is an important tool for risk management. Insurance is the process of transferring the financial burden of the insured to the insurer for the risk that may affect his life, property or liability. In human society, there are many possibilities of disaster and danger. The calamity, the risk that can happen now, today, or tomorrow. Or the accident is uncertain. No one knows when a disaster strikes. Therefore, insurance is considered indispensable for everyone and forever.
Insurance is the best way to get compensation by transferring uncertain risks. Uncertain risk, the person or organization suffering from an accident can buy an insurance plan with the condition that they will be compensated in case of such an event by paying a certain premium according to their risk. Insurance is a written contract between two parties.
insurance; It is an agreement between the insurance company and the insurer. In this process, the burden of compensation for the insured’s risk is transferred to the insurer through insurance. Insurance is done for a fixed period. The insurance company pays compensation in case of any loss to the insured property or life within the stipulated period.
Here are 10 benefits of getting insurance:
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Incentives to Save: Life insurance encourages people to save money. It encourages us to be aware of protecting our wealth and avoiding accidents that may occur later. The amount deposited in the bank can be withdrawn during small work, but the amount deposited in the insurance company cannot be withdrawn until the end of the period, so the amount is saved and returns are received in the form of bonuses, so life insurance encourages savings.
Risk Mitigation: Life insurance is used against the risk to a person’s life. Anything can happen at any time in life. Insurance transfers the risk to the insurer, so the financial loss after the disaster is compensated.
Future Financial Security: Life insurance is a long contract in itself. The insured has to pay the installment for a certain period of time and finally gets paid with a bonus, which ensures the future.
Relief in financial crisis after the death of the insured: Its importance is even more evident in a country like ours. In some families, the source of income is only one person. If he dies due to any reason, his family is in trouble. However, if he has life insurance, then even after his death, his family will get the amount as per the insurance policy. This provides a lot of financial support to the family. The money received from the insurance company can support the family.
Income Tax Exemption: Income tax is levied only on the remaining amount after deducting the amount of tax exemption from your total income. Currently, life insurance premium expenses up to Rs 40,000 can be deducted from the annual taxable income.
Friends in old age and physical disability: } There are also plans to collect insurance premiums for a certain period of time and then get income like pension for a certain period of time. With such insurance, there will be no financial shortage even in old age and difficult circumstances. In case of permanent disability or disability due to an accident, life insurance pays a certain amount of money as monthly expenses.
Loan without collateral: Life insurance allows the insured to get a loan by pledging the life insurance policy and not any other property. After 2 years of starting the policy, the insurer can take a loan of up to 90% of the insurance paid, which can ease the difficult situation. By taking a loan, the insured can start a business and take profit.
Increase in social prestige: The insurer has a different kind of prestige in the society because the insurer is confident and confident. By insuring various types of documents for the future, he is confident and can spend his days happily even in old age.
Education, initiation and marriage arrangements: Since the arrangement of education for their children as well as social activities including marriage will cost a lot of money, the insurance money can be used to lighten the burden on the parents.
Profitable Investment: { Life insurance is not only a way of life protection but also a type of investment. In case of death of the insured before the stipulated time, the life insurance policy provides a lump sum amount to the desired person or dependent family. The company also pays the principal insurance amount and the bonus amount.
Life insurance is essential for everyone. Life insurance has become a basic necessity as it protects human life while alive today and not tomorrow.
