Most life insurance agents have gone through a course covering the basic principles of insurance and provide the knowledge necessary to sell insurance policies. Although life insurance is the backbone of an individual’s financial planning, it is only one part of a comprehensive financial plan. Therefore, a complete education and life and health insurance training in the whole insurance area is necessary before beginning business.
The main types of insurance are permanent life insurance, term life insurance, disability insurance, health insurance, accidental death, and dismemberment insurance. The term policy is usually for a specified period, typically thirty years. The benefits depend on the age of the insured and the premium paid. This type of insurance is more expensive than the other types because premiums are paid for a lifetime, whereas the rest of the plans are for a limited time.
Term insurance is the most popular type of life and health insurance because its premium is cheaper than the other types. The term of the policy can vary from as short as one year to twenty years. It has a lower risk of loss and thus is a cheaper form of insurance.
Health insurance is another type of insurance. This type of insurance pays only for medical expenses incurred by the insured during the policy period. For example, the policy may pay for hospitalization during the first six months of the term or for any service rendered to an insured during the policy term. Premiums are paid for both the initial and continuing health costs. Health insurance companies often include prescription drugs in the premiums, which means that individuals who take medication are likely to pay higher premiums.
On the other hand, life insurance pays the benefit to a beneficiary at the end of the policy period, upon the death of the insured. This type of insurance is much more expensive than the two other forms because premiums are paid until death. Thus the death benefit is paid out to the beneficiary after the policy period has expired. Unlike health insurance, there is no need to renew this type of insurance. Most life insurance companies also require the payment of a non-refundable deposit.
Life and health insurance training courses are usually divided into two groups – those that cover the policies themselves and those that teach the policies’ fundamentals. The former covers the basics of the policies, while the latter covers the basics of purchasing them.
