Life insurance is a contract between a person (the insured) and an insurance company. In this type of coverage/insurance, the insurance company agrees to pay a sum of money, known as compensation or death benefit, to the beneficiaries designated by the insured in the event that the insured dies during the period covered by the policy.

There are several types of life insurance, but two of the most common types are:

+ Term Life Insurance:

In this type of insurance, a specific period of coverage is established, called the "term." If the insured dies during the policy term, the beneficiaries receive the death benefit. If the insured survives the policy term, the insurance expires and there is no payment of benefits. This type of insurance is simpler and tends to be more affordable, especially for young, healthy people.

+ Permanent Life Insurance (Whole Life Insurance or Permanent Life Insurance):

This type of insurance provides coverage for the entire life of the insured, as long as the premium is paid. In addition to the death benefit, permanent life insurance typically has an investment component, meaning that part of the premiums are invested and can accumulate cash value over time. This allows policyholders to access this cash value through loans or withdrawals, although this may affect the death benefit.

Life insurance can provide financial security to beneficiaries in the event of the death of the insured, helping them cover expenses such as outstanding debts, mortgages, children's education and other related expenses. The choice between term life insurance and permanent life insurance depends on the individual needs and circumstances of the insured. It is important to consider factors such as the desired length of coverage, budget, and financial goals when selecting a type of life insurance.