All About Life Insurance and How It Works?

Buy a Life Insurance Plan in a few clicks

Now you can buy life insurance plan online.

Kotak e-Term Plan

Protect Your family’s financial future with Kotak e-Term Plan. Know more

Kotak Assured Savings Plan

A plan that offer guaranteed returns and financial protection for your family. Know more

Kotak Guaranteed Savings Plan

A plan that offers long term savings and insurance in one premium. Know more

Kotak e-Invest

Insurance and investment in one plan with Kotak e-Invest. Know more

Kotak Health Shield

Insurance against medical expenses related to heart, brain, liver and Cancer. Know more

All About Life Insurance and How It Works?

All About Life Insurance and How It Works?
  • 13th Nov 2021 |
  • 863

When you think about life and its many phases, all you wish for yourself and your loved ones is a peaceful and secure future. You want them to be safe with or without you, and therefore, you start planning for the same. One of the first few steps in this process is to ensure that they are financially protected. For this, you can look at different types of life insurance plans, read about them online, talk to insurers to understand how life insurance works, what they are and how they work. If you have any such doubts in your mind, let us answer them for you!

Understanding Life Insurance

Though all the life insurance policy information you may have come across may feel overwhelming and confusing, the policy actually involves easy to understand terms and conditions. Put simply, a life insurance plan is a financial cover that will be provided to your family after your demise or given to you at the maturity of the policy. In this, there is an agreement with the insurer to get a certain sum of money, also known as sum assured, for which you must pay premiums at a pre-decided interval - this may be every month, every year, half-yearly or quarterly depending on the payment plan you choose for yourself. It is a simple policy that you can buy from an insurer at an affordable price despite not having a financial background or expertise in the field.

Let’s say, for example, you buy insurance for a term period of 20 years. If anything were to happen to you in that time period, a sum assured amount, pre-decided by you and your insurer together, would be given to your family (also known as the nominee/nominees or beneficiary/beneficiaries). However, outliving this period will lead to you and your beneficiaries not acquiring any payout.

A Pool of Options to Choose from

Now that you know what insurance is and have some life insurance information, let us look at the different types of life insurance plans that you can choose from.

Life insurance plans in India can be categorized into two broad categories - term plans and whole life covers. The former offers coverage for a chosen set period, that is 15 years, 20 years, etc. The latter aims at providing a life cover, as suggested by the name, whole life cover is a plan till the end of life or 99 years.

Why Investing in Life Insurance Will Benefit You?

Investing in different types of life insurance plans has a lot of benefits. However, most importantly, a life insurance plan can help you fulfil various financial goals that you may have set for yourself and your family and pay off the loans for your family’s future, such as:

  • Home loans
  • Education for your children
  • General household expenditure
  • Tax deductions - under section 80c of the Income Tax Act, 1961

Apart from this, you can now also buy online life insurance plans easily. Such online purchases have proven to be very practical with the ongoing shift to a completely online life that we are currently living. Further, life insurance policy information is readily available on websites along with a series of life insurance plans to compare and arrive at the one which is most suited for you! Life insurance is essential, so get yours today!

Kotak e-Term Plan

Download Brochure


  • Nominal Cost
  • Multiple Plan Options
  • Flexible Payout Options
  • Critical Illness Rider
  • Tax Savings
  • Long term Coverage

Ref. No. KLI/22-23/E-BB/492


Browse our library of resources

- A Consumer Education Initiative series by Kotak Life

Similar Articles

Is Life Insurance an Investment?

How to Buy a Term Life Insurance Online

6 Different Types of Insurance Policies

What is a Single Premium Term Plan and its Tax Benefit?

All about IRDAI

Life Insurance for Millennials

Why Term Insurance for Women is Important?

Is it Worth Buying Disability Rider on Term Insurance?

How to Calculate Human Life Value(HLV)?

All about Your Rights and Duties While Buying Life Insurance Policy

5 Smart Steps to keep in mind while buying term policies

What are the Benefits of Endowment Policy?

Does Life Insurance Policy Cover Covid Death?

1 CR Term Insurance Plan: How to Pick the Best 1 CR Term Plan

Term Plan with Return of Premium (TROP)

Everything You Must Know About ULIP Riders

Can An Individual Buy Multiple Term Insurance Plans?

Take 100% Responsibility of Your Family with Term Life Insurance

Why is Medical Test Important While Buying a Term Insurance?

5 Reasons Why a Women Should Buy a Life Insurance

Life Insurance and Millennials

Customer Awareness on Information Security

Most Common Life Insurance Riders to Enhance Your Existing Policy

Different Types Of Life Insurance In India

Key Things to Review in Your Life Insurance Policy Document

Different Types of Insurance Policies in India

5 Benefits of Gifting Life Insurance Cover to Your Spouse

Life Insurance for Overweight Applicants

Top 5 Common Life Insurance Myths and Facts

Think About Life Insurance Sooner than Later

Difference Between ULIP and Endowment Plan?

Terms and Conditions of Term Insurance Plans

भारत में जीवन बीमा पॉलिसियों के प्रकार

How Much Life Insurance Do You Need?

Can a Term Plan be the Substitute for a Retirement Plan?

What Is Staggered Payment Option Under Term Insurance Policy?

What are robo-advisors in insurance?

Is Voluntary Life Insurance the Same as Basic Life Insurance?

Important Life Insurance Terms You Must Know

Life Insurance Plans for Women

When Should You Review Term Life Insurance of Yours?

What Happens If I Stop Paying My Life Insurance Premium?

Life Insurance vs Mutual Funds

10 Most Frequently Asked Questions - FAQs on Term Insurance

How Much Life Insurance Costs and How Much Insurance Cover You Need?

Compare Different Life Insurance Products Offered By Kotak Life

Why Do Life Insurance Agents Avoid Selling Term Plans?

What Is Surrender Value (Cash Surrender Value) in Insurance and how is it calculated?

क्या जीवन बीमा एक निवेश है?

How Much Life Insurance Cover Do I Need?

Guidelines for Linking Aadhar and PAN to Insurance Policies

How to Revive the Lapsed Life Insurance Policy?

What Is a Whole Life Insurance Plan?

When are Millennials required to take out a life insurance policy?

How Many Insurances Should I Have?

Does Family History Affects your Term Life Insurance Rates?

Types of Life Insurance Or One Investment, Many Options

Role of IRDAI in the Insurance Sector

Biggest Life Insurance Myths

What Should One Expect During the Medical Evaluation for Life Insurance?

How to Select a Perfect Life Insurance Policy in India to Protect Your Future?

Life Insurance Beneficiary

Kotak Life Claim Settlement Ratio

Best Insurance Plans in India

How to Choose a Life Insurance Policy

Is Life Insurance For Millennials Really Needed?

What Should One Consider Buying: Term Insurance or Traditional Life Insurance

Insurance Changes You Need to Make Post Marriage

Term Insurance Vs Life insurance: Small Details, Big Differences

What is Underinsurance & The Dangers of Being Underinsured

भारत में सर्वश्रेष्ठ टर्म प्लान कैसे चुनें?

Adding A Child to Your Life Insurance Policy?

Why do I Need Life Insurance?

What is an Endowment Plan?

Savings cum Protection Plans Secures Your Family from Unforeseen Events

Can You Apply For A Life Insurance After Getting Heart Attack? Here is Everything You Need To Know

Why You Should Never Cancel Life Insurance Policy

Choose the Nominee of a Term Life Insurance Plan Wisely

Types of Life Insurance Policies in India

What is Human Life value and a Human Life Value Calculator?

Life Insurance with Money Back vs Without Money Back

Why Online Term Insurance Plans Cheap?

Staying Insured While Investing

Is It Advisable To Have Multiple Life Insurance Policies?

ULIPs: Suitable for all

How to Customize Your Life Insurance Policy with Riders

In India, should NRIs purchase life insurance?

What Is The Life Insurance Penetration In India And How Does It Compare Globally?

How to Buy a Life Insurance Plan?

Should You Buy Life Insurance After Getting Married?

FAQs on Life Insurance

Types of Insurance You Must Invest in for Secure Future

Guide for Buying Online Term Insurance Plans for Senior Citizens

Are Deaths Due To Coronavirus Covered by Kotak E-Term Plan?

What is the Difference Between Limited and Regular Pay Insurance Plan?

Process of Filing A Claim For Life Insurance

Term Life Insurance vs Accidental Death Insurance

5 Common Life Insurance FAQs and Answers

Benefits of Term Insurance with Critical Illness Rider

Voluntary Life Insurance Policy Vs Group Life Insurance

Choosing Between Short-Term & Long-Term Insurance Plans

Why One Must Buy Term Insurance before 25 Years

Various Term Insurance Premium Payment Options Available in India

Term Insurance for Home Loan: How Term Plan Helps in Paying Off Home Loan?

Why Buying a Term Insurance is Important for all Parents

9 Most Important Things You Must Learn About Paying Life Insurance Premium

Is it Possible to Reduce Life Insurance Premium without Affecting Sum Assured?

Difference Between Money Back and Endowment Policy

7 Superficial Reasons People Avoid Buying Insurance Online

Difference Between Insurance and Assurance?

Term Life Insurance Vs Money Back Life Insurance

Unit-Linked Life Insurance (ULIPs) vs. Term Insurance

Does Life Insurance Cover Terminal Illness?

Why Life Insurance Is Always a Smart Decision

Does Life Insurance Pay for Suicidal Death?

जीवन बीमा क्या है?

5 Reasons Why You Need Life Insurance in College

Is it Possible to Make Changes in a Term Plan’s Specification Post Purchase?

Details Required To Be Filled In A Life Insurance Form

First Job? Here’s Some Tips on How to Manage Finances

Term Insurance Claim Process

Sabse Pehle Life Insurance

Why Your Family Should Know About Your Life Insurance Policy?

“Life” Insurance or “Death” Insurance?

Role of Life Insurance in Your Financial Portfolio

Always keep your Nominee informed

Benefits of Buying Term Insurance Plan for Senior Citizens in India

Term Insurance Tips for NRIs in India

Can You Transfer Life Insurance Policies to Another Company in India?

Life Insurance for Overweight Applicants

Beware of Phishing & Fraud Insurance Calls

Health Insurance VS Life Insurance

5 Advantages of Life Insurance Going Digital

Important Terminologies of Life Insurance

How to Make Death Claims on Life Insurance?

5 Easy Steps to Buying A Policy

A Term Insurance Guide for Disabled People

Reasons Why Term Insurance Claims Get Rejected

What is Insurance Coverage? Overview, Types, and Examples

Insurance Vs Investment - A Guide to Your Financial Goals

वरिष्ठ नागरिकों के लिए ऑनलाइन टर्म इंश्योरेंस प्लान खरीदने के लिए गाइड

How To Choose The Right Life Insurance

What is Minimum Life Insurance Policy?

What Is the Procedure to choose a nomination in life insurance policy?

Why You Should Buy Term Insurance under the MWP Act (Married Women’s Property Act)?

What Is Financial Planning?

How Does Life Insurance Work?

Life Insurance Policy Closure

Important Factors to Consider While Choosing the Right Term Period for Your Term Insurance Plan

Health Insurance VS Life Insurance

Can NRI Buy Life Insurance in India?

Comparing low premium term insurance Is Not the Only Factor While Buying Life Insurance

What Is Insurance Rider and It’s Benefits?

How to Find the Best Term Insurance Plan in Seven Steps

All About Backdating in Life Insurance

Choosing a Life Insurance Beneficiary

How to Choose Life Insurance for All Ages?

Why Renewal of Term Insurance Plan is Important

How Do Term Insurance Plans Differ for Smokers?

Do Life Insurance Premiums Increase Every Year?

What Is Investment Insurance?

5 Things to Keep in Mind While Buying Life Insurance Policy

Life Insurance and Retirement Planning

जीवन बीमा पर ऋण

Digital Life Certificate for Pensioners Seeking Pension

Do Your Financial Planning with Life Insurance!

Nominee in insurance - A Complete Guide on nomination in insurance

All You Need to Know About Life Insurance - Its Benefits, Features, and Types of Life Insurance

Why do most Indians choose the wrong way to buy life insurance?

What is Group Insurance?

Is It Time to Review Life Insurance Policy of Yours?

What is Sum Assured in Endowment Policy?

NRI Premium Payment Options

How to Choose the Right Life Insurance Policy for Your Age?

Who Is A Nominee In A Life Insurance Plan?

5 Ways to ensure faster settlement of claims

5 Things to Consider Before You Buy Life Insurance

6 Things You May Not Know about Life Insurance

Different Kind of Deaths that are Not Covered in a Term Insurance Plan

How Often You Must Review Your Life Insurance Policy?

What Is Social Impact Investing and How Does It Benefit Society?

What is the Current Trend in Term Insurance?

Loan Against Life Insurance Policy

How To Use Different Types Of Life Insurance For Retirement Planning?

What is Life Insurance?

Life Insurance Vs. Mutual Funds Investment

Importance of Checking Claim Settlement Ratio before Buying Life Insurance

Term Insurance Vs Car Insurance: A Budgetary Choice You'll Regret

Important Features of a Term Insurance Plan

A Step-by-Step Guide: How To Make An Investment Plan?

Difference Between Term Insurance and Endowment Plan

All about Life Insurance Calculators