Life insurance is important because it provides financial security to the family in case of the unfortunate death of the policyholder. Life insurance can enable the family of the policyholder to stay financially independent so that they do not have to compromise their lifestyle.It helps us protect the things we value the most, like our cars, homes and other such valuables. It significantly differs from a life insurance policy, as Life Insurance is a long-term policy and General Insurance is particularly based on per-year renewal.