There are many reasons why it is a good idea to take out a Life Insurance policy. The most obvious is to provide financial security and peace of mind for yourself and to your family, should you die unexpectedly. However, there are many other reasons why you should consider taking it out - these include protecting your mortgage, any estate or land you own, and even your business interests. The result of the policy is that, should the holder die, the insurance company pays out a lump sum to the dependants or other nominated persons.
There is also a critical illness policy which will only pay the benefit amount should you suffer a critical illness or become permanently and totally disabled. However most people take out a policy that includes life insurance, meaning that it will pay a lump sum benefit on the death of the policyholder or should they suffer from a critical illness or become permanently and totally disabled.