Life Insurance provides a cash payment to the beneficiaries when the policy owner dies. Benefits paid to a beneficiary are not subject to federal income taxation.
Term life insurance is the most basic type of life insurance and can be the most affordable. The policy is written for a fixed number of years. It is considered affordable because the premiums can be a relatively economical way to insure significant financial support for dependents. The premiums will increase as the policy holder ages.
In addition to term life there are other insurance products that include saving and investment options. These policies are likely to come with fees and commissions that are higher than other saving and investment options. However they may be preferable if life insurance is needed beyond a fixed term. That is why these types of insurances are broadly referred to as permanent life insurance.
Shop carefully. For more information, checkout the University of Florida publication “An Overview of Life Insurance” at http://edis.ifas.ufl.edu/fy1393