Come on you did not open this post to find an Investopedia definition of Life Insurance, did you?

I recently came across a brochure by our reverend Regulator a book on Life insurance. I read it and knew that this was another obfuscation attempt and nothing else!

Well let us look at what is Motor Car insurance. If your Motor Car insurance?

Well if your car meets with an accident, or is destroyed completely, the car insurance company will replace the car. Or pay you enough money to buy a similar car.

Now when it comes to medical insurance, the insurance company will reimburse all the money that you spent…

However when it comes to life insurance…can the life insurance company REPLACE the person who has died? NO, OBVIOUSLY NOT.

So what does life insurance do?

It replaces the cash flow that the bread winner was bringing. If it is replacing the cash flow, SHOULD we not call it ‘Cash flow insurance’ ….at least there will be no emotional drama. Once it is called ‘Cash flow insurance’ there will be no competition from the emotional side….

 

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  1. Subra Sir
    Nice name you have given for the product. And rightly said the emotional connection will be chucked off.

    Dr. Kishan

  2. cash flow insurance against DEATH of insured person.

    boring and scary. no self respecting advertising executive will allow such a product to be released 🙂

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