According to nature
Policies are differentiated based on the nature of benefits offered
Temporary policies:
Offers only protection or death benefit over a limited period of time.
Permanent policies:
Offers death and living benefits within the insured's lifetime. Living benefits maybe in the form of dividends, anticipated endownments, disability,policy load or non-forfeiture options.
According to coverage
Policies are differentiated based on the number of persons enjoying protection under a specific policy:
Individual life: covers the life of a single person
Joint life: covers the life of two or more persons. Under this policy the first death which occurs among the lives covered effectively terminates the policy
Group: covers the lives of group of people
According to participation in divisble surplus
Policies are differentiated based on dividend entitlements
Participating: entitles the policy owners to recieve dividends which are sourced from the surplus earnings of the insurance company, subject to approval of its board of directors
Non-participating: does not share dividends
According to line business
Policies are differentiated based on the market segments to which a policy caters to
Ordinary: caters to the middle and upper income-earners, premiums of these policies are payable on an annual, semin annual,quarterly basis
Industrial: caters to low income earners. Premiums of thes policies are payable on a monthly,weekly,or daily basis
Group: caters to the insurance needs of employee groups,union,and the like the premiums of which are generally deducted from the salaries of employees or co shared by the employer.
