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Business

Life insurance is protection against financial loss in the event of the death of the insured person. Usually life insurance is taken out so that the bereaved family will have some money, perhaps when the main bread winner dies. However, it is possible to take out life insurance on a 3rd party if you can prove that you would suffer financially if that person died. For example, 2006 has been Queen Elizabeth II’s 80th birthday. Any company who produced items to celebrate that event, such as commemorative plates or silverware, would have suffered financially if the Queen had died before reaching 80 years.

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There are different types of life insurance - whole of life policies, term insurance and endowment policies. Now both whole of life and endowment policies are actually life assurance rather than life insurance. The difference is that insurance covers you for something that might happen while assurance covers you for something that will, assuredly, happen.

 

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