How does a term life insurance contract work?
Term life insurance is one of the two types of individual death benefit contracts to which an individual can subscribe independently. In this specific case, the contract has an end date, for example the 75th birthday of the subscriber or the 40th anniversary of subscription to death insurance.
The insured risk is the death of the policyholder, which, if it does not occur before the operating deadline, will no longer be covered by the insurer beyond the expiration date in question. Premiums paid over several years, or even decades, cannot be recovered by the subscriber or his beneficiaries in the form of the guaranteed capital provided and these are then referred to as non-refundable contributions.
Only death and disability insurance allows the subscriber to directly recover the guaranteed capital provided, since the risk of loss of autonomy is covered in addition to that of death. However, the person must be the victim of a PTIA (Total and Irreversible Loss of Autonomy) before the end of the contract.
Who are the beneficiaries of death and disability insurance?
The subscriber of a death insurance contract himself chooses the beneficiary or beneficiaries to whom he wishes to transfer the amount saved. He can communicate this information to his insurer in 3 ways:
by naming them directly in the contract;
by notifying it by registered letter, even several years after the subscription.
by indicating it in his will.
A distinction should be made between beneficiaries of death insurance and natural heirs. The former can be anyone, a relative or not and even a business, when the latter are determined by the legal framework, with a precise order of succession and distribution of the inheritance.
The beneficiaries can therefore exercise their right to recover the capital of the provident policy if they are designated as such. Depending on the contract taken out, death may be covered in the event of:
of illness, long or lightning;
from an accident;
suicide (although insurers guaranteeing the type of death are much rarer). The Insurance Code explains that death by suicide constitutes an exclusion of coverage if it occurs less than 1 year after taking out the contract or after adding an endorsement increasing the guarantees and / or the capital provided.
An accident death insurance does not cover, for example, illnesses. It is therefore advisable to choose a multi-risk insurance to be covered in all circumstances.
What is the price of death insurance?
The contributions for a death insurance contract are calculated according to the person's age, state of health and the amount of the desired guaranteed capital (the amount that will be paid to the beneficiaries). With equal guarantees, the price of death insurance can be multiplied by 10 between a subscription at 30 years and a subscription at 60 years, hence the need to carry out a simulation of whole life or term death insurance.
Smokers see their death insurance premiums increase considerably, the health risks being greatly increased in this specific case.
The following table shows average prices for information only for different guaranteed capital, at different subscription ages:
Death insurance (without disability)
Subscription age
40 years
Guaranteed capital
€ 30,000
Annual bonus
75 €
Accident and sickness insurance
Subscription age
45 years old
Guaranteed capital
€ 300,000
Annual bonus
€ 479
Classic death insurance (without disability)
Subscription age
50 years
Guaranteed capital
€ 10,000
Annual bonus
40 €
Classic death insurance (without disability)
Subscription age
60 years
Guaranteed capital
€ 10,000
Annual bonus
100 €
Classic death insurance (without disability)
Subscription age
70 years
Guaranteed capital
€ 10,000
Annual bonus
€ 250
إرسال تعليق