Life assurance (also called life insurance) protects dependants against the financial shock of a death. Term cover pays only if death happens in a set period. Whole of life and endowment style products may mix protection with savings elements. The exact promise is always in the policy wording, not the brochure headline.
Key takeaways
- Start from the income your family would need, then size the sum assured.
- Term cover is usually cheaper pure protection; savings type policies cost more and need separate scrutiny.
- Health disclosure at application is critical; non disclosure can sink a later claim.
- Name beneficiaries clearly and keep the policy where your family can find it.
Why it matters in Ethiopia
As formal employment and bank credit grow, more households meet life cover through workplace schemes or loan related policies. Treat those as a base layer and check whether the amount still matches your family’s real needs.