Type of relationship that can be Insured

Regarding the principle of insurable interest inherent in all insurance products, including life insurance products. One type of relationship that accommodated in it is the relationship among members of the nuclear family (husband, wife and children). Besides the context of nuclear family relationships, there are three other types of relationships that satisfy the principle of insurable interest, are (1) The relationship between creditor and debtor, (2) The relationship between employee and employer/company, (3) The relationship between the Employer/Company and Employees.

The first explanation of the relationship can be insured is the implementation of life insurance protection that meets the principles insurable interest in the context the relationship between creditors and debtors. In this case, the creditor is the party providing the credit/loan to the borrower (debtor). Lenders who intend to insure life debtor must show great interest for the survival of the debtor.

Life insurance allows for creditors to minimize financial loss if the debtor dies at any time, and he is still has a debt payment obligations to the creditor concerned. What happens if the debtor dies and creditors have not applied the life insurance scheme against the debtor? The death of the debtor does not automatically eliminate the obligation to repay the remaining debt.

However, creditors may have the potential losses if the debtor's assets are not sufficient to pay the remaining debt is still there. That is why, a step in the right and wise for creditors when a life insurance policy applied to debtors.

Second, life insurance protection can also be applied to protect the interests of the employees of the existence of employer / company. This scheme is applied to secure the value of the employment contract between two parties, and brings benefits to both.

For example, an employee getting a salary of $ 1000 per month for a two-year contract period, based on labor contracts that have been agreed. Permission of the employer, employees may purchase a life insurance policy that positioned the employer as the insured, with a maximum insured value of money amounting to $ 48,000.

What happens if the employer dies before the contract ends? When life insurance is for employers who already owned by the employee, the employee can still get the revenue potential in accordance with the amount previously agreed.

Third, the employer also can insure the life of employees when the employee meets the interests of the principle of insurable interest. These interests usually arise when the employment contract binding both parties for a specified period.

When the employee dies before the contract expires, the employer may suffer financial losses if the insurance scheme has not been applied to the employee.

Employers also may have insurable interest in its employees if the employer has spent significant costs in providing training facilities for employees.

In this context, employers will experience losses on the entire cost of such training if the employee dies.

The most common reason for employers to purchase a life insurance policy, towards life is to protect the interests of their employees or the company's financial losses, if the employee died or suffered health problems, especially if those employees are key employees.

Type of insurance policy for the benefit of this kind is commonly known by the term Keyman Insurance Policy. An employee included in the category of key employees if its existence is vital and important for the survival of the employer or company.

For this type of policy, the insurer may approve the amount of money insured in a certain amount to cover losses from the death of key employees.

Protection costs could also accommodate the interests of the employer or company to find a replacement employee and the cost of education and training for replacement employees.

The three types of relationships are included in the category of relationships that can be insured, so that policyholders can obtain protection when the partners involved in the relationship having events / unexpected misfortune in the future.

If misfortune happens, life insurance companies will be able to give the maximum cash benefit to the insured who is eligible. Life insurance policyholders can get the maximum benefit from the protection of its policyholders.