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What is the difference between individual and group life insurance?

difference between individual and group life insurance

Check the differences between these two products and which one best suits your needs.

The big difference between individual and group life insurance is the level of personalization. In general, group life insurance meets basic needs, common to a group of people, linked together by a bond or common interest.

Individual life insurance is a product adjusted to the needs of each client. This type of insurance is contracted directly by the insured, who receives his policy according to the chosen plan. In order to personalize the product, in general, a complete analysis of the insured is made considering a series of factors such as profession, financial responsibilities to the family, sports practices, and health history, for example.

Individual life insurance offers specific and adjustable protections, according to the style, age, and standard of living of each client. In these cases, depending on the insurance company, it is also possible to opt for complementary coverages such as funeral assistance and receipt of insured rates for periods of hospitalization.

But, after all, how does group life insurance work?

Group life insurance is generally used by companies to ensure the safety of their employees and, thus, demonstrate commitment. Offering this benefit is quite common among companies today. Thus, group life insurance is a product that serves employees and/or business owners.

The number of employees required for hiring varies with insurers. But in general, collective plans are offered, with coverage from three or even two employees and minimum ages, usually between 14 and 60 years old.

As it is not a product with a high level of personalization and, in general, it meets the basic needs of the customer, the values ​​of these insurances are usually lower and cease to exist when the company leaves the company. Therefore, for more specific and long-term protection, it is interesting to seek qualified advice and individual insurance.

The difference between life insurance and pension

The difference between life insurance and pension

Some people may be confused when choosing between life insurance or a private pension plan.

The pension plan aims to be long-term savings, that is, it is part of your retirement planning. Social security is a way for you to save today to have a reserve when you stop working.

Life insurance is an immediate protection. With the policy in hand, whenever an event is covered by the policy occurs, the insured or the beneficiary receives what was agreed upon when contracting the insurance.

Both protections are important for a successful financial strategy.

Private pension

Private Pension was born to complement Social Security and compose the retirement planning of clients.

Usually, banks and independent insurers offer this type of product. In private pension plans, the customer chooses the amount of the contribution and the frequency with which it will be made. The amount to be received will be based on the contribution that was made and the results of the financial investments linked to the plan.

Life insurance

Life insurance is considered a protection against unforeseen circumstances. So, contrary to what many people imagine, it is a product suitable for people of all ages. If you have someone you would like to support in your absence, then you should hire this service.

After all, this is the goal of life insurance: to guarantee the financial security of your dependents for a certain period of time if you are unable to do so and cannot be confused with a private pension plan.

Do you know the life insurance market?

Do you know the life insurance market?

The life insurance market has existed in the USA since the empire, but there are still many doubts about its importance and the benefits it contemplates. The most common of these is to believe that life insurance only serves to financially protect the family in the event of the death of the insured. Do you know what the others are?

See below for 5 useful information about these products that still confuse the population.

1. Product is not used only in case of death

When it comes to life insurance, we automatically think of the cases in which the insured person dies. However, there are other options for broader protections against countless life hazards.

Imagine, for example, that a patient has been diagnosed with cancer. In addition to the health risk, the disease can compromise the insured’s and his family’s income. Therefore, there are several products available on the market that include protection in case of serious illnesses.

There are other coverages, such as in the case of medical procedures, hospitalization, accidental disability, and anticipation of receipts in case of terminal illnesses. Some products are characterized by the constitution of a redemption value after a certain period of effectiveness of the policy. For these types of products, it is worth noting that the formation of redemption value is not to be confused with a private pension.

Life insurance can still be customized for different health profiles and lifestyles, such as different risk analysis for people in risk professions or hobbies. Therefore, it is important to know all the options and be sure about the ones that best suit your profile before signing the contract.

2. Life insurance does not equate to private pension or retirement

In the last few years, the life insurance category has become popular in which the insured can, at the end of the agreed period, redeem part of the amount constituted over the years even if the claim does not occur.

Contrary to what many people imagine, this redeemable life insurance should not be confused with a private pension, retirement, or any other type of investment. This is because the main objective of life insurance is the financial protection of the insured and the family in the event of a risk provided for in the insurance contract, different from the private pension plan, for example, in which the purpose is to build the necessary financial reserve to guarantee the quality of life during the retirement years.

3. Importance for young people and singles

It is common to think that life insurance is only useful for older people. But the reality is not so, since young people and singles can use life insurance in their own financial planning and that of their family. The numbers confirm that this segment is, in fact, growing.

Unforeseen events can occur at any time in our lives. Although less likely to develop serious illnesses or trigger a claim, it is important that people in this age group are also protected. Young people normally fall into a lower risk category, which reduces the premiums paid. But the more that decision is postponed, the greater the chance of any situation occurring that places the insured potential in a higher risk profile.

Likewise, singles and no dependents who plan to start a family in the future should also think about it and, if applicable, hire the product while prices are more attractive.

4. Affordable costs for different customer profiles

Asked why they did not take out life insurance, many would say it is because there are not enough financial resources to do so. What some people don’t know is that there are customized insurance options for each customer profile.

As with car insurance, a prior risk analysis is carried out, and the price can fluctuate according to numerous variables, such as age, compensation amount, healthy habits, family medical history, among others.

5. Business plan may not be enough

Many companies offer a corporate life insurance plan, but these products do not always fully meet customers’ needs. It is important to calculate whether, in the event of an event, the contracted plan will in fact offer the desired coverage. It is also relevant to read the terms of the contract carefully to see if, in the event of dismissal or job change, there will still be insurance coverage.

Since these products involve many features, including a number of optional benefits, it can be difficult to fit your needs into a particular group. To better meet the demands, it is possible that personalized life insurance is the most appropriate option.

Insurance solutions can also be used in life

Insurance solutions can also be used in life

Insurance can bring benefits in situations such as disability and serious illnesses

There are many people who understand that life insurance is death only as a cover. In fact, this type of product is just one of several options that the market offers.

Coverages whose beneficiary is the client and, therefore, are used in life, are also good alternatives for financial planning.

The insurance for disability exists to ensure that the customer will bear the costs under their responsibility if you become unable to generate income due to an unforeseen caused by accident or illness.

The purpose of this type of coverage is to guarantee peace of mind for income protection.

For temporary cases, a solution in the life insurance market is Temporary Disability Daily (DIT) coverage. “In general, the operation of this product is very simple.

In the case of temporary leave from work, caused by accident or illness, the client receives a daily rate, observing the value and specifics of the contracted plan ”.

What if you were diagnosed with diseases like cancer, Alzheimer’s disease, stroke, or acute myocardial infarction? Would it be important to have a reserve for specific treatment without affecting your savings?

It is for this purpose that insurers offer the coverage of Serious Diseases.

“Serious Illness insurance is complete protection designed to support you in the discovery of more complex health problems.

With it, in the case of diagnosis of any of the more than ten covered diseases, you receive the contracted amount at once to help with treatment expenses or other expenses ”.

Life insurance, private pension and investments: do not confuse these products

Life insurance, private pension and investments

They are important in financial planning, and their differences make them complementary

The Americans have increasingly understood the different products aimed at financial planning and its purposes, but there is still some confusion, for example, in the case of individual life insurance and private pension. Both are often seen as products that compete for the same space in financial planning, but in reality, they should be seen as complementary tools.

Both life insurance and private pension plans look to the long term, however, the similarities end there. Each has specific functions and benefits. The pension products aim at retirement, allow the choice between progressive or regressive tax regimes, and the reduction of the tax base by up to 12% – when the Income Tax (IR) is declared in full and contributions are made in the PGBL.

In addition, they use specially constituted investment funds, which do not incur quota-sharing, a semiannual collection of income tax expected in most conventional investment funds and which reduces profitability in the long run.

Individual life insurance, even the so-called redeemable ones, aims to protect the financial condition of the beneficiaries in the event of the insured’s early and unexpected absence, or the financial condition of the client himself, in situations that can transform his life, such as disability accident, serious illness, and even hospital admissions. Therefore, they are not and should not be confused with investment or social security.

Because of these characteristics, many experts recommend that people consider life insurance, pension plans, and investments as complementary products in their financial planning. Investment funds, therefore, are aimed at accumulating equity; private pension aims at a more comfortable retirement; Life insurance, in turn, is essential for succession purposes or to help the insured himself and his family to deal with possible problems along the way, such as early absences, serious illnesses, hospitalizations, or disability.

The amount accumulated in the funds of the pension products, through the contributions made and the profitability earned, will define retirement income, with no guarantee of value.

The indemnity of life insurance does not depend on the amount of installments paid or profitability, since, immediately after the policy is issued, protection considers the full amount contracted.

For example, even if the customer has only paid a portion of the insurance contract when a claim occurs, the beneficiary may receive the full amount contracted. That is, the product does not depend on accumulation and, after the first payment, the insured is already covered.

How does redeemable insurance work?

The redeemable insurance has a specific characteristic: it allows the insured to redeem an amount when necessary. However, when requesting the receipt of part of this amount, the protection amount is reduced, and, in cases where the entire available amount is accessed, the policy is automatically canceled.

This particularity of redeemable life insurance aims to give more flexibility to the insured, and should not be confused with the return of installments paid, profitability, or financial gains.

When hiring life insurance, it is important to provide all the health information requested in a complete and correct manner, in addition to carefully reading the general, special conditions, and terms of the policy to know the situations covered.

insurance or pension

A benefit for succession planning found in pension plans and life insurance is the fact that the death indemnity is exempt from income tax and the possibility to choose beneficiaries other than the legal heirs.

However, an exclusive benefit of life insurance is that it is not considered an inheritance; therefore, it is not subject to the Tax on Transmission Cause Mortis and Donation, called by many an inheritance tax. As the inventory process involves costs for the heirs, and, in many cases, can consume 15% to 20% of the total amount involved, it is normal to take out life insurance to cover these expenses and ensure the financial stability of the family during its resolution.

How long does the insurer pay a life insurance claim?

How long does the insurer pay a life insurance claim?

The regulatory agency establishes a maximum payment period of 30 days after receiving the documentation, but insurers can pay much earlier

An inventory process can drag on for months and even years until the heirs are able to receive the inheritance to which they are entitled, and this has made it increasingly common to look for solutions that speed up the receipt of values ​​with much less bureaucracy.

This search for liquidity has been fulfilled by individual life insurance, as it does not qualify as an inheritance in the inventory processes. Thus, the payment of the indemnity must be made within a maximum of 30 days after the insurer receives all the necessary documents.

In practice, insurers can pay well before 30 days – in several cases, the insurer’s payment to policy beneficiaries takes up to five business days.

It is important to remember, however, that the term only begins to count after the delivery of all documentation provided by the insurer.

The first step when making the claim is to inform the insurer in writing as soon as an event occurs that qualifies for the benefit. This step can be done by the insured or by the beneficiaries, depending on the situation.

Then, it is necessary to prove the occurrence of the fact that generated the right to benefit and all related circumstances.

For this reason, insurers usually require some documents before making payment, such as, in cases involving death, the death certificate of the insured, the identity document of the insured and the beneficiaries, a document signed and stamped by a doctor describing the occurrence of the claim and relevant medical history, among others.

The deadline is the same for accidental disability and serious illness payments. What can change, however, are the documents required by the insurer. In cases of serious illness, for example, it is necessary to provide copies of tests that prove the insured person’s special conditions.

Therefore, to expedite the receipt of the benefit, it is important to carefully read the general conditions for delivering all the necessary documents on each occasion.

Prior risk analysis

Another differential offered by some insurance companies, mainly independent ones, is the prior risk analysis. This is a step in contracting the policy that may involve carrying out various health tests, usually paid for by the insurer itself.

With the prior analysis process, it is possible to expedite the payment of the benefit more quickly and provide peace of mind for the client or its beneficiaries. This is because the insurer already has the data of the insured, since it has health information provided – that is, respecting the general conditions of the insurance, the insurance will be paid.

It is worth mentioning that, regardless of previous examinations, it is essential that policyholders complete the health questionnaire sincerely, without omitting any information, so that there is no problem in paying the benefit and it is carried out more quickly.

The importance of life insurance in the fight against breast cancer

The importance of life insurance in the fight against breast cancer

Life insurance brings specific coverages that help people in life.

After skin cancer, breast cancer is the most common. There are 60 cases per 100,000, according to the National Cancer Institute, and most women are diagnosed at an early stage. But, even when starting treatment as soon as the disease is discovered, only 30% of patients do not develop metastasis – when cancer cells spread throughout the body -, according to a survey conducted by the pharmaceutical company Pfizer.

In the fight against cancer, such as breast cancer, life insurance can play an essential role. Currently, there are individual insurances that offer policies specifically aimed at serious illnesses, in which the insured receives the benefit while still alive and can use the money in any way he wishes.

It is important to remember that the diagnosis of a serious illness can impact the financial life of the insured and their family members – especially considering that many women are responsible for supporting the home.

Studies show that cancer tends to increase from now on. The Ministry of Health estimates that about 600 thousand new cases of the disease will be registered later this year. Per year, 87 thousand of the total deaths (225 thousand) caused by the disease are of economically active people (between 15 and 65 years old), points out the movement All Together Against Cancer.

For example, cancer is the main reason for claiming benefits. From January 2014 to June this year, more than 1,300 claims related to the disease were recorded, which represents 36.7% of the total. Second, infarction appears in 4.9% of cases, followed by an accident at work, with 4.6% of cases.

“Women are increasingly looking for life insurance options and the insurance market has been following this trend, establishing important benefits for this public”, explains Alessandra Bussab.

According to her, life insurance is related to the protection of women and their families. “Any adversity that happens in this path of building wealth can cause the person to consume the money he saved”, he says.

Online life insurance: we uncover myths of this type of insurance

Online life insurance

This type of insurance contract is an economical and quick option for those who want to protect themselves, but do not have much time

Those who understand the importance of being protected in case of unforeseen circumstances do not hesitate when looking for alternatives for this. And life insurance with online contracting offers the facility needed to enjoy life without worrying about eventualities.

This type of contract is a quick option for those who want to protect themselves, but do not have much time to go from insurer to insurer to make quotes, and are already in the habit of shopping over the internet.

If you also see an advantage in taking out life insurance online, check out the main myths on this subject.

Myth 1: purchasing insurance online is unreliable

This myth is directly linked to the scams we see on the internet today. The purchase tip is the same for any other product: be wary of very low prices and inaccurate information and choose companies with a name in the market and years of experience.

Few insurers and brokers have online contracts. Before companies in the insurance industry make this service available on the Internet, a whole study of information development and security is done. So, it is possible to make the quotation on the computer screen safely.

Myth 2: the broker must be in the same city of residence

Insurer support can be offered at any time and day. Today there are different types of service and sales channels that facilitate people’s daily lives, such as telephone, online chat, e-mail, Whatsapp, among others.

In any of these channels, life insurance specialists will be available to assist you and answer any questions about the life insurance coverage of your interest.

Myth 3: support in the physical space is better

The capital value is chosen by the insured person. Of course, there are some limitations to this, such as monthly income, age, type of coverage contracted, sex, profession, and health status.

What the insurer does is assess the risk. The higher the risk, the higher the monthly fee and this also influences the capital value.

Did you understand a little more about online life insurance? Many people pass on unsubstantiated information and end up spreading false news. So that you don’t fall into myths like these, our tip is to always seek clarification on the subject.

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