What is life insurance?

Life insurance is a contract between an individual and an insurance company that provides financial protection in the event of the insured person's death. It works by the policyholder paying regular premiums to the insurance company, and in return, the company promises to pay a death benefit to the designated beneficiaries upon the insured's death. This benefit can be used to cover funeral expenses, replace lost income, pay off debts or mortgages, or provide for the future needs of the insured's family. Life insurance offers peace of mind by ensuring that loved ones are financially taken care of after the policyholder's death. There are various types of life insurance, such as term life insurance and whole life insurance, each with different features and benefits.