Observations revealed that people use the term Life Insurance and Life Assurance interchangeably. Meanwhile, they connote different meanings and interpretations.
Insurance contract generally is an agreement between the insurer and the insured to make good should the event insured against occur. This is the reason why the policy holder pays a certain sum of money called premium as consideration to cover the specified risk.
Life assurance is that policy that pays the relatives of the insured person at the event of his death. The policy holder makes a monthly contribution with the choice of making another contribution as investment. At the event of natural death, the insurer will pay out his contribution together with his investment to the beneficiaries of the policy holder. One good thing about this type of insurance is that it encourages savings.
Life insurance policy type Life Assurance Premium Relief on the other hand is for a period of time in which the event can happen or not. If the event happens, that is if the insured died within the period, compensation will be made to his relatives. However, if the person lives beyond that period, the policy terminates automatically without any compensation
.