In the event of illness or accident resulting in incapacity or invalidity, or in the event of death, long-term care insurance guarantees a financial solution to compensate for loss of income and maintain their and their family’s standard of living.
Life insurance allows you to protect yourself and your family against the financial consequences of everyday vagaries. The law of 31. December 1989, known as the Evin Act, defines life insurance as follows: ” operations aimed at preventing and covering the risk of death, risks affecting the person’s physical integrity or related to maternity or the risk of incapacity or invalidity or the risk of unemployment.
What is the role of pension insurance?
Foresight is a contract or guarantee of it covers any deterioration in his state of health that results in a reduction or loss of income. The main risks covered by long-term care insurance are:
- work stoppage in case of illness or accident (temporary incapacity for work – ITT),
- disability (partially or completely, temporarily or permanently),
- Death.
In addition to this, the risk of dependency and unemployment can also be covered by the pension fund.
The pension fund makes it possible to compensate for a loss of salary, by payment of daily allowance during a period of incapacity for work. Or to ensure the maintenance of resources in case of disability by payment of a periodic annuity to the insured. In case of death, a capital is paid to designated beneficiaries to the contract. The pension agreement may also contain provisions for the payment of a return of surviving spouse or a education pension for the benefit of dependent children.
Protecting myself and my family: practical solutions
Insurance or pension: what’s the difference?
In reality, in a broad and common sense, there is no real difference between insurance and life insurance.
To be sure is to show foresight. The terminology is also misleading because what is called health insurance is actually the first form of providence. And most maintenance contracts are called insurance… (creditor insurance, funeral insurance…).
Thus, in the narrow sense, pension insurance is a branch of personal insurance as opposed to property insurance. And within personal insurance, it is part of so-called non-refundable insurance as opposed to savings insurance (life insurance). If you’re an employee, your paycheck contains one or two “benefit lines”—separate from mutual insurance lines—that correspond to the disability/death coverage your employer has written on behalf of its employees.
Pension insurance as a supplement to health insurance and supplementary health insurance
The compulsory health insurance scheme reimburses medical expenses, covers hospitalization expenses and pays financial benefits in case of work stoppage. But this support is limited and temporary.
The balance to be paid for health expenses can be paid, in whole or in part, byhealth insurance more (Where mutual health), taken by the company for its employees or, if this is not possible, on an individual basis.
Companies must also offer job stoppage, disability and death coverage to their employees, which compulsory pension scheme is required by law, collective agreements or industry agreements.
To go beyond these guarantees and increase the protection of its employees, the employer can also offer them insurance pension in the form of a collective agreementon a mandatory or optional basis, with or without partial payment of the contributions from the company.
People who do not benefit from such a contract or those who want higher guarantees can take out one individual pension insurance agreement.
Everyone can take out a pension agreement with the insurance company or insurance intermediary they choose. The price offered depends on the selected guarantees, the subscriber’s age and state of health.
You must not confuse pension insurance with life insurance or savings contracts
Pension is an insurance contract. It is only brought into play in the event of the occurrence of the insured risk (disability, invalidity, death). This is a so-called “lost funds” contract. Deposits do not make it possible to build up capital and cannot be recovered if the risk does not occur or if the subscriber terminates the contract. The pension agreement is not a savings solution.
Conversely, the life insurance agreement is a savings contract which allows you to build capital, recoverable by the subscriber of the contract when he is alive, in the form of partial or total “repurchase”, or by conversion to an annuity. And the life insurance gives authority transfer of this capitalto the beneficiaries designated in the contract, in the event of the subscriber’s death secured.
Which pension scheme for which need?
There are many types of self-ownership insurance to meet the need to cover various risks that you may be exposed to, yourself and your family.
Borrower insurance
Borrower’s insurance, taken out when entering into a home loan or consumer creditallows the insured borrower to benefit from repayment of installments from the insurance company when he can no longer service his credit due to disability, incapacity, death and sometimes loss of job.
life accident insurance
Life accident insurance guarantees financial, and sometimes material, coverage of bodily injury as a result of a domestic accident or on the occasion of the exercise of a leisure or sports activity, a medical accident, an attack… This contract can guarantee bodily injury, loss of business income or payment of capital in the event of death.
Burial insurance
Burial insurance providesanticipate the financing of his funeral, sometimes also their organization. Upon the death of the insured, a capital burial contract allows the payment of the capital created to the beneficiary named in the contract. In the case of a benefit contract, the capital is paid out by the insurance company to the undertaker responsible for carrying out the funeral.
Even when the bank account is blocked due to the death of its holder, funeral expenses can be paid by debiting the deceased’s account, up to €5,000 and within the limit of the credit balance on presentation of the invoice for the funeral expenses.
Dependent insurance
Dependent insurance allows the insured to benefit from the payment of an annuity or capital when a state of dependence arises, partially or in total depending on the contract entered into. Assistance services can supplement the contracted cover. The costs of long-term care insurance vary according to the guarantees taken out and the insured’s age at the time of taking out the insurance.
The insurance premium may continuously increaseby an annual revaluation clause according to an index mentioned in the contract or technical elements in the insurance company’s management of these contracts.
Death insurance
Death insurance makes it possible to protect relatives, by payment of annuity or capital, in the event of the insured’s death. Depending on the contracts, compensation may be paid in the event of accident, illness (provided you are not already ill at the time of subscription) or even suicide (after a grace period).
If the insured risk, death, does not occur before the expiry of the death insurance contract, no capital will be paid to the designated beneficiaries. And the contributions paid are not recovered by the insured when he terminates the current contract.
