Life insurance is one of the most important financial products you can purchase, yet it’s often misunderstood or overlooked. Whether you’re just starting your career, getting married, or planning for retirement, life insurance can provide vital protection for your loved ones.

What is Life Insurance?
Life insurance is a contract between you and an insurance company. In exchange for regular premium payments, the insurer promises to pay a lump sum—called a death benefit—to your beneficiaries when you pass away. This money can help cover expenses like funeral costs, outstanding debts, or everyday living expenses.

Types of Life Insurance
There are two main types of life insurance: term life and whole life (or permanent life).

Term Life Insurance: This covers you for a specific period, such as 10, 20, or 30 years. It’s generally more affordable and ideal for people who want coverage during their working years.

Whole Life Insurance: This provides lifelong coverage and includes a savings component called cash value, which grows over time. It’s more expensive but offers long-term financial benefits.

Why Do You Need Life Insurance?
Life insurance is not just for parents or older adults. If anyone depends on your income, or if you have debts or financial responsibilities, having life insurance ensures they’re not left struggling financially if something happens to you.

Common reasons people buy life insurance include:

Replacing lost income for family members

Paying off a mortgage or other large debts

Funding children’s education

Covering funeral and burial costs

How Much Coverage Do You Need?
A general rule of thumb is to purchase a policy worth 10 to 15 times your annual income. However, this can vary depending on your financial situation, lifestyle, and goals. Many online calculators can help you estimate the right amount of coverage.