Life insurance is a contract between the policy owner and the insurer, where the insurer agrees to pay a designated beneficiary a sum of money upon the occurrence of the insured individual's or individuals' death or other event, such as terminal illness or critical illness. In return, the policy owner agrees to pay a stipulated amount at regular intervals or in lump sums. There may be designs in some countries where bills and death expenses plus catering for after funeral expenses should be included in Policy Premium. In the United States, the predominant form simply specifies a lump sum to be paid on the insured's demise.
As with most insurance policies, life insurance is a contract between the insurer and the policy owner whereby a benefit is paid to the designated beneficiaries if an insured event occurs which is covered by the policy.
The value for the policyholder is derived, not from an actual claim event, rather it is the value derived from the 'peace of mind' experienced by the policyholder, due to the negating of adverse financial consequences caused by the death of the Life Assured.
To be a life policy the insured event must be based upon the lives of the people named in the policy

LIFE INSURANCE RESOURCE   Life Insurance Rate Chart   Difference Between Term & Permanent   How Much Do I Need?   Insurance Department by Each State   Our Process  When do I need Life Insurance?  Existing Policy Review  Life Insurance Riders

* Rate as of October 2010 for a 35 year-old male 10 year term, $500,000 in coverage based on Preferred Best underwriting. Eligibility for coverage is subject to underwriting requirements. Rates for other ages, face amounts and other underwriting classes are also available. Rates shown for sample ages at issue are based on Preferred Best underwriting as of August 2010 and available with monthly electronic drafts. *Sample rate for a 35 year-old male, $500,000 coverage for a 10 year term. Rates shown for sample ages at issue are based on Preferred Best underwriting as of August 2010 and available with monthly electronic drafts. Best class rates are varies by states. Other rating classes, level periods and coverage amounts are available. Rates are subject to underwriting and are not guaranteed. Rates have been rounded to the nearest dollar. Guarantees apply to certain products and are subject to the insurer's claims-paying ability and financial strength. Insurance policies and contracts contain withdrawal charges, limitations, exclusions, holding periods, termination provisions, and terms for keeping them in force.