What is life insurance? How it works.

Life insurance provides a financial contract where an insurer pays a designated beneficiary upon the insured person's death. This system ensures financial security for dependents. Term life insurance is a specific type of coverage that lasts for a predetermined period, such as ten or twenty years. If the insured individual passes away during this term, the policy pays a death benefit. It is generally more affordable than permanent options, focusing on temporary protection needs.