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policy is intended to protect the family of the insured after his death. The rate of premium
in this policy is comparatively lower than the other policies.

iii. Children Education and Marriage Endowment Life Insurance
The cost of children education and marriage is financial burden to their parents. To
minimize that burden, parents can do children’s education and marriage endowment life
insurance policy. Under this policy, the parent should pay the amount of premium for the
certain specified period on regular basis. On the maturity of the policy, the insurer pays
insured amount which can be used for their children marriage and higher education.
iv. Term Life Insurance

Term policy is issued for a short period of time ranging from 3 months to 7 years.
This type of policy is made just to give security to the creditors or lenders for the payment
of loan by the expiry of the term of that loan/debt, to which it was insured. It is thus,
made for the guarantee of the recovery of loan or debt before or at the due date. The
premium of such a policy is very much nominal.

v. Anticipated Endowment Life Insurance
It is a type of endowment policy under which certain part of the sum of insured
amount is paid at certain intervals during the endowment period and the balance amount
is paid at the maturity of the policy. In case of death of the policy holder before the maturity
period, the whole insured amount with bonus is payable to the nominee irrespective of
the installment already paid. This policy is generally issued for 15, 20 and 25 years. If it
is issued for 20 years, 25% of insured amount is paid after 10 years, 25% is paid after 15
years, and balance 50% is paid along with bonus after 20 years.

Points to Remember

i. Endowment Insurance ii. Whole life Insurance iii. Children Education and Marriage
Endowment Life Insurance
iv. Term Life Insurance v. Anticipated Endowment Life Insurance

Non-Life/General Insurance

General insurance is the insurance other than life insurance. The insurance of goods,
materials, things and properties is known as non-life insurance. Some of the types of
general insurance are discussed below.

i. Marine Insurance
It is believed that the marine insurance was the first developed form of insurance.
In the ancient time, international trade used to be done mainly through sea routes. The
sea routes were subject to various risks caused by perils in the sea such as collision with
rock or another ship, attack by enemies, fire, hijack and capture by pirates, etc. The risks
were attached to both the ship and cargo. At the time the traders entered into agreement
among themselves, under which the loss caused by such a risk to any trader could be

90 Aakar’s Office Practice and Accountancy - 10 Financial Institutions 91