Simply put, life insurance is a legal agreement or a policy between you (the insured) and an insurance company (the insurer). When you purchase a certain amount of life insurance (let’s say a $200,000 policy) and remain in good standing on your policy, the insurer promises to pay that $200,000 to your beneficiaries, who are the people you choose to receive this money (the death benefit) if you pass away.
It’s also important to note that life insurance can be very affordable, no matter how much money you make. That $200,000 policy might be as low as $20 a month for a 30-year-old woman who doesn’t smoke with coverage for the next 20 years.