Life insurance that fits your life
Protect your loved ones — and your budget — with flexible, no-hassle term life insurance.
What Is Life Insurance?
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.
For the contract to be enforceable, the life insurance application must accurately disclose the insured’s past and current health conditions and high-risk activities.
KEY TAKEAWAYS
- Life insurance is a legally binding contract that pays a death benefit to the policy owner when the insured dies.
- For a life insurance policy to remain in force, the policyholder must pay a single premium up front or pay regular premiums over time.
- When the insured dies, the policy’s named beneficiaries will receive the policy’s face value, or death benefit.
- Term life insurance policies expire after a certain number of years. Permanent life insurance policies remain active until the insured dies, stops paying premiums, or surrenders the policy.
- A life insurance policy is only as good as the financial strength of the company that issues it. State guaranty funds may pay claims if the issuer can’t.
The unique benefits of insurance
Without insurance, many aspects of modern societies and economies could not function. Insurance provides the cover against unforeseen events that enables individuals and businesses to carry out their daily activities.
Buying an insurance policy for a smaller, known premium removes the possibility of a larger, potentially unaffordable loss, bringing peace of mind and security. These small premiums are collected in a pool, which allows the losses of the few to be spread among the many.
European insurers pay out almost €3 billion a day in claims to help businesses and individuals through difficult events and in benefits to long-term savers.
