Frequently Asked Questions on Life Insurance
How Does Life Insurance Work?
Insurance that pays out a sum of money either on the death of the insured person or after
a set period. Life insurance (or life assurance, especially in the Commonwealth), is a
contract between an insurance policy holder and an insurer or assurer, where the insurer
promises to pay a designated beneficiary a sum of money (the benefit) in exchange for a
premium, upon the death of an insured person (often the policy holder).
Depending on the contract, other events such as terminal illness or critical illness can also
trigger payment. The policy holder typically pays a premium, either regularly or as one
lump sum. Other expenses (such as funeral expenses) can also be included in the benefits.
What Is Coverage Like for Life Insurance Policy?
Life policies are legal contracts and the terms of the contract describe the limitations of the
insured events. Specific exclusions are often written into the contract to limit the liability of
the insurer; common examples are claims relating to suicide, fraud, war, riot, and. civil
Life-based contracts tend to fall into two maior cateqories:
- Term Insurance - Low cost insurance that generates no cash value. Many Term products offer a
10, 20, or 30 year level Term premiums.
- Permanent Insurance - Usually generates a cash value and is intended to last until death.
The goal of life insurance is to provide a measure of financial security for your family after
you die. So, before purchasing a life insurance policy, you should consider your financial
situation and the standard of living you want to maintain for your dependents or survivors.
Get A Life Insurance Quote from Koch Insurance
To see how our life insurance policies can help your family be secure, please contact us for
a free quote. Koch Insurance agencies are located throughout South Dakota, with office
locations in Tea, Tyndall, Tabor, Springfield, and Yankton. We'll provide you with all the
information you need to make an informed decision on your family safety.