Life Insurance is a financial cover for a contingency
linked with human life, like death, disability, accident, retirement etc. Human
life is subject to risks of death and disability due to natural and accidental
causes. When human life is lost or a person is disabled permanently or temporarily,
there is loss of income to the household.
Though human life cannot be valued, a monetary sum
could be determined based on the loss of income in future years. Hence, in life
insurance, the Sum Assured ( or the amount guaranteed to be paid in the event of
a loss) is by way of a ‘benefit’. Life Insurance products provide a
definite amount of money in case the life insured dies during the term of the
policy or becomes disabled on account of an accident.