Life insurance is an investment which you make so that your family's future is safe and secure. You have to pay a premium throughout the insured period and if anything happens to your during this period, the money goes to your nominee. Everyone is mortal and the policies are designed based on this universal truth. That's the reason that salesman often begin their pitch with a lecture on mortality. They also tell you that your family will be in big trouble when you and your pay checks cease to come in. This logic works like magic and very few people are able to keep their heads on their shoulders when they understand this logic.

Today it has become more common to break your car than dying. People see automobile insurance as an interesting option. In this policy, the company pays up when you wreck your car. You can use the money to repair your car or buy a new one. But life insurance is different; it is not of much use when you are alive. Life insurance is unlikely to provide you money if you need it to put your kid into college and you are no way near dying. You will have to die to get the money!

When a salesman approaches you, do ask about the different types of insurance policies that are available. You can either buy term insurance or life insurance policies. A Whole Life or Universal Life policy offers you protection throughout your life. You pay a high premium, a part of which goes into other investment instrument, though it's better to make investment outside your insurance. You should be careful as to what your policy offers and what is does not offer.

A term policy is one in which you pay premium for a particular term for which you want insurance. You pay the premium periodically and in case of your death during that period your nominee receives the entire amount. However if you live through the term, you get back the amount along with interest.

Life insurance policies seem to be inefficient when you compare them with other savings instruments. The company decides on the returns and the benefits depending on its performance. You should buy a term policy in case you really want a secure future for someone in your absence.

This is an investment with a bit of irony. You pay and the amount goes to someone else after your death. However this is what life insurance is. You save so that your family can have a secure future!