What is life insurance simple definition?
Life insurance is a contract between an insurer and a policy owner. A life insurance policy guarantees the insurer pays a sum of money to named beneficiaries when the insured dies in exchange for the premiums paid by the policyholder during their lifetime.
Why is life insurance important in simple words?
Life insurance provides money, or what's known as a death benefit, to your chosen beneficiary after you die. It can help give your loved ones access to money when they need it. Understanding life insurance can help you plan for your family's long-term financial needs.
What is life insurance introduction?
When you buy life insurance, you enter a contract with an insurance company that promises to provide your beneficiaries with a certain amount of money upon your death. In return, you make periodic payments, called premiums.
What is the real purpose of life insurance?
The major purpose of life insurance is protection — the instant estate to meet survivor needs. Some policies include a savings feature, but there are many other ways to save money and make investments.