Life Insurance is a policy or contract between an insurance holder and an insurer (insurance company) where the latter promises to pay a designated sum of money to the family on the death of the insured person. Depending on the policy, other events such as critical illness or accidental policy can also be added to trigger the payment. The policyholder pays a premium on a regular or lump sum basis. The policy pays a specified amount called a “death benefit” to the named beneficiary, when the insured dies. If you are the bread winner of your family, then life insurance is a must for you.