An agreement or contract between a policy owner and an insurer, where the insurer agrees to pay a sum of money upon the occurrence of the insured individual's or individuals' death or other calamity, such as terminal illness or critical illness is called Life insurance. In return, the policy owner agrees to pay a predetermined amount called a premium at regular intervals or in a lump sum. Such agreements are legal contracts and the terms of the contract contain the limitations of the insured events. The contract has specific exclusions to limit the liability of the insurer.

Most of the Life contracts fall into two major categories:

Protection - This is designed to provide a benefit to the designated beneficiary in the event an insured event occurs, typically a lump sum payment.

Your income and your family’s financial future are safeguarded through Protection plans even if you are not around. You are also shielded from heavy economic losses. Further the impact of financial risk on you and those dependent on you are reduced.

Investment - Here the main objective is to initiate the growth of capital through regular or single insurance premiums. The common forms are whole life, and variable life policies.

People opt for life insurance because very often most of their other planning goes awry. They opt for it because they realize the need to protect their families after their death; or to set some amount aside for emergencies and additional income in their old age.

Life insurance is an assurance that your family will receive financial assistance, even in your absence. Coverage of life ensures that your family receives a sum of money should something unforeseen happen to you. Thus your family is financially protected at all times.

Apart from serving as a protective cover, the insurance plan acts as a flexible money-saving scheme, which allows you to accumulate money to buy a new car, get your children married, buy a house and even retire comfortably. It must be borne in mind that while insurance may not always be foremost in your thoughts, it is always a friend waiting to help you.