Financial planning is must for every individual. When we start saving money for our goals, there is always a fear of the unknown. We can't predict the future. So just by doing investments we cannot ensure that all is well. Buying insurance is a good way to protect yourself, your family & assets. Learning some basics of insurance will help you invest wisely.

You are working hard every day to earn a decent living standard. Based upon your monthly expenses, you can do some savings. You do financial planning based on your current health & wealth status. But with time as your age increases health problems can also surround you. It may be major surgery, a fracture or an infectious disease. Every medical problem poses a hurdle in your path. In such conditions having an insurance policy is a big advantage, not only it provides financial support in a crisis but it also gives a sense of security.

Insurance plans can be different types like endowment plans or unit linked plans. All these have their importance. Selection of a proper plan is not easy. You may have to take the help of an investment expert. For example the amount of life cover required is not same for all of us. It is calculated using parameters like your age, current assets, total liabilities, monthly income & number of family members. So, take proper advice to find out what is best for you. Insurance helps your personal finance in one more way by offering tax benefits.

Insurance policy is a contract between the insurer & policy owner. A fixed amount has to be paid by the policy owner either in lump sum or annually, which is called as premium. The premium is calculated on the basis of insurance cover required & the duration of insurance. Depending upon the term & conditions mentioned in the policy one has to pay the premium for certain years, known as premium paying term. If you fail to do so, the policy will be lapsed. The maturity value or sum assured is the amount guaranteed by the company in case of death of policy owner or when the policy term ends. The life cover may continue after the premium paying term, in some plans, till whole life.

Buying a policy is very easy nowadays. You can now buy them online. All leading insurance companies are offering this service. You can easily compare different plans & choose the perfect one. There are some other sites which provide you with insurance plans of different companies, you just have to submit some basic information about yourself & all the plans will be displayed in a tabular form.

To sum up, life insurance is an important tool when planning your personal finance. Due to availability of so many options in market choosing the right one is difficult. Take the help of a financial advisor if you are not sure about it. Live a happy & secured life!