Life insurance can be defined as a contract, in the form of a policy, wherein an insurance provider undertakes to provide financial coverage to an individual in exchange for a payment over regular periods of time called a premium. The insurance provider will offer a lump-sum amount to the beneficiaries or nominees of a policyholder in case of his / her untimely death. This payment will include the sum assured, which is the amount you have purchased the policy for, and the minimum amount of money that the company will pay you before adding bonuses. Apart from the death benefit, a life insurance policy also offers maturity benefits in the form of pay outs in case the policyholder survives the entire policy term. In addition, life insurance policies are also known for delivering tax benefits under Section 80C of the Income Tax Act, 1961.