Life insurance is a contract between an insurer and a policyholder in which the insurer guarantees payment of a death benefit to named beneficiaries when the insured dies. The insurance company promises a death benefit in exchange for premiums paid by the policyholder. Your beneficiaries can use the money for whatever purpose they choose.
Types of insurance, there are Term insurance which is for specific number years, and permanent insurance which could to age 100, whole life or universal.
Who needs life insurance? Generally people need insurance to protect their loved ones who depending on them, and they believe these dependents will be in trouble financially if they are not there. Dependents are children who still live at home or have yet to graduate from college and child with special needs. But a dependent could be anyone who is financially dependent on you, like a spouse, sibling, aging parents or close friend.
Insurance companies offer additional option “Riders” you can add to your coverage such as critical illness, premium waiver, accidental death.