Planning for the future has become a vital necessity of providing financial stability for you and your family regardless of the circumstances. This is where protection and savings programs or policies become useful. Such programs or policies can help you prepare well for the future, allowing you to achieve your financial goals and provide financial protection to your family in the face of unexpected negative circumstances.
Certain plans categorized under ‘Protection and Savings Insurance’ can also help you expand your savings over a certain period of time. You can increase the value of your savings by taking advantage of insurance programs that provide various investment avenues for your savings, with the investments being managed by the insurer.
What is a protection and savings insurance program?
It is an insurance contract whereby the insurance company pays a certain amount to the insurance beneficiary if the insured dies or becomes disabled. Alternatively, a lump sum amount (including savings proceeds) is paid to the insured at the end of the agreed savings period provided for in the insurance contract. In return, the insured pays a premium for the duration of this type of policy.
Types of Protection and Saving Insurance
Insurance companies in Saudi Arabia offer two kinds of protection and savings insurance:
- Protection Insurance: The insurance company pays a certain amount of money to the beneficiaries registered in the insurance contract in the event of the death of the insured or the total or temporary disability of the individual or parties named in the contract. The Insured will pay monthly contributions as agreed upon in the contract until the end of the contract.
- Protection and Savings Insurance: In this policy, the insurance company pays an amount, including the proceeds of savings at a future date against the payment of monthly contributions agreed upon in the contract.
How to select the right insurance policy for your needs
Here are some tips to keep in mind when selecting a protection and savings policy:
- Choose an insurance plan with a monthly premium that you can afford taking into account your monthly income and expenditure needs;
- Choose a period that fits your financial goals and timelines; and
- Choose the insurance coverage that suits your long term needs and your family’s as well.
Benefits of having a protection and saving policy
Protection and savings insurance contracts differ from one insurance company to another in terms of insurance coverage and the value of monthly payment of contributions/premiums. Here, we list the main benefits in terms of insurance coverage that you can get from such an insurance policy.
- Coverage in case of natural death or as a result of an accident;
- Coverage in case of total disability or incurable diseases;
- Benefits of a financial plan that offers you a variety of savings, protection and investment options; and
- Repayment of premium installments payable by the insured in case of death or total or partial disability.
Premium payment options
Under the insurance policy, the insured individual shall pay the agreed installments of the premiums during the period specified in the contract. Payment options vary depending on what is agreed upon in the insurance policy. Payments may be made on an annual, bi-annual, quarterly or monthly basis.
Exceptional cases not covered by protection and savings insurance policies
There are some cases that are not covered under the insurance policy as agreed on in the insurance contract. Here are some of the exceptions that are not covered by the policy:
War, invasion and civil war;
- Terrorist attacks and acts of deliberate sabotage; and
- Damages resulting from nuclear radiation.
How useful was this post?
Click on a star to rate it!
We are sorry that this post was not useful for you!
Let us improve this post!
Thanks for your feedback!