Co-Founder, TermInsuranceBrokers.com, Goldenzweig Financial Group, Las Vegas, Nevada
The idea of insurance first began as a way of reducing risk for given transactions. The purpose of insurance as we've come to know it today is to shift the risk of a catastrophic financial event to a third party (the insurance company) by paying a premium to the carrier in exchange for coverage.
In life insurance, the policy creates cash upon the death of the insured. Many people buy life insurance for different reasons - such as paying off debts so the family members won't be stuck with those bills (e.g. mortgage, cars, etc.), income replacement, estate planning, leaving a legacy to loved ones, just to name a few.
The idea of insurance has been around for centuries. It started as a way to reduce risks with cargo on ships being lost at sea. Life insurance just became a product to transfer risk when it came to an important financial loss of life in business transactions. From there it has evolved to modern day life insurance needs in which we are all familiar.
Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
Life insurance is a way to share an unacceptable risk. The premature loss of a human being is a tragedy. That loss can create a severe financial impact. Sharing that risk was the motivation to establish the first life insurance societies and later companies.
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In life insurance, the policy creates cash upon the death of the insured. Many people buy life insurance for different reasons - such as paying off debts so the family members won't be stuck with those bills (e.g. mortgage, cars, etc.), income replacement, estate planning, leaving a legacy to loved ones, just to name a few.