Nowadays, most people will hear about life insurance. There are many kinds of terms in life insurance that one should know. It is useful for everyone who wants life insurance in his life.

Here are two terms of life insurance that one should know. What follows are simple explanations of the words that are commonly used in life insurance market and in life insurance polices. Each insurer might use a slightly different variation in their own policy wordings so these examples are purely there to assist and help and should not be read as being actual legal definitions. The first term is Life insured. This is the person whose life is insured. If this person dies during the policy period then that is when the policy will pay out. And the second one is Insured. This is the original owner of the life insurance policy and usually the person who took the policy out.

So for instance a wife may as the ‘insured’ take a life policy out on her husband who would be the ‘life insured’ Finally, under a whole life policy the insurer agrees to issue the policy for the whole of the life insured’s life provided that the life insurance premium continues to be paid. It is common for whole life polices to start off with a low sum insured and for the sum insured to increase as more premiums are paid into the fund. These policies are said to have an investment factor and if maintained for long enough can be cashed in.

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