Life insurance provides financial security for your dependents if something happens to you. It replaces your income, pays off debts, funds children's education, and ensures your family maintains their lifestyle. Without adequate coverage, your family may face financial hardship.

The HLV method calculates your economic value by estimating future earnings, subtracting personal expenses, and discounting to present value. This is considered more accurate than simple income multiples because it factors in your age, working years, and expected returns.

Term insurance is pure protection with affordable premiums and no investment component. ULIPs combine insurance with market-linked investments but charge higher fees. For most people, a term plan plus separate investments yields better returns and adequate coverage.

Buy term insurance early when premiums are lower. Choose a cover of at least 15-20 times your annual income. Disclose all health conditions honestly to avoid claim rejection. Compare plans across insurers and check the claim settlement ratio before purchasing.