Ideas about life insurance:
Life insurance is a contract that is executed between an insured and an insurance company.
Where the insurance company guarantees that in case of death of the insured a certain amount of money will be paid to the heir of the insured.
Under the terms of the contract, the insured gets paid even if he is sometimes seriously ill. The insured usually pays a certain amount to the insurance authority one time or at a time.
The benefit to the insured is the gain of "peace of mind"; Because he knows that his heirs will not have financial problems after his death.
This method is also used to gain financial benefits after retirement.
If the insured accepts the insurance carefully and specifies so in the terms.
Life insurance is a legal contract and the terms of the contract are limited by the scope of insurance. Special terms are written here.
Ideas about life fund:
Many ordinary investors forget that 90 percent of life insurance company's life funds are owned by the company's policyholders. They are not all life fund shareholders.
The remaining 10 percent is owned by the company or shareholders. If the life fund per share of a listed life insurance company is 3.5 USD, then if the shareholder's share (owner) is more then 0.35 USD. This is called the net asset value per share (NAVPS) of a life insurance company.
Now it is possible to lay a foundation for the valuation of the shares of the companies by reference to this fictitious NAVPS of the life insurance company.
But even taking it literally as a basis would not be entirely reasonable. Because the quality of this fund and its ability to generate revenue is also a consideration.
Instead of looking at how much the size of the life fund is increasing or decreasing in total, investors need to look at how much of the life fund is coming from the premium of new policy of growth, and how much is coming from the increase in the value of old assets.
The higher the premium contribution of the new policy, the better the business growth of the company. And the growth of old funds is a measure of the company's investment efficiency, which means that the company is efficiently building and managing its portfolio.
There is a difference between having 0.35 USD in the hands of a skilled manager and the same amount in the hands of an unskilled man. It will depend on whether the company's share price will be above 0.35 USD or below. Growth track record and business efficiency issues will also be added during valuation.
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