In some developed countries like the UK & EU, government makes social security payments, albeit very small amount, if you do not have earning member or you have no source of income. In most developing countries this type of policy does not exist, either because of the cost to the country or sheer size of the country’s population makes such policies prohibitive. One must still realize the fact that such non-earning families are helpless and cannot be left at the mercy of relatives or society. Mostly the earning member of the family would ensure some safety net for the dependent in case of his untimely death like rental income, savings etc., but life insurance beats all these safety nets hands down. Life insurance is a crucial part of risk coverage, and any financial advisor or wealth manager must add this to his client’s portfolio. Risk Cover: The primary purpose of life insurance is to provide financial protection to dependents against the risk of your untimely demise. The lumpsum amount that the dependents get cannot replace you but certainly avoids the pains of no income in your absence. They can maintain their lifestyle, pay off the debts, cover essential expenses and the cost of education and healthcare. So if you have unpaid debt, children whose education is not completed yet and other liabilities you need to recognize that you do carry the risk of untimely death and must buy protection. In fact, in our country Life Insurance agents carry a big stigma of irritable salespeople and that indirectly creates the repulsion towards life insurance. Historically LIC has some role to play in that because a Rs.2 Lakh annual premium for 20 years used to give only life cover of 40 Lakhs or so. Traditional endowment plans have been partly responsible for individuals to not consider life insurance seriously. It was always thought of as a savings instrument and not so much as risk coverage. That perception is slowly changing due to the introduction of pure risk plans like Term Insurance. In brief the term insurance gives life insurance for a specific period and pays to dependents only on death. The cost of term insurance can start from as low as Rs.500 per month for 1crore sum insured for a 21 year old male. Normally you need to go through the medical test and policies are issued for a specified period as well as for whole life. Types of Life Insurance Products