In a modern society, a sense of family amenability meant that life and health insurance would grow in importance. That’s why life and health insurance have long been recognized as necessary and basic elements in an individual’s or a family financial program.
Still and all life and health insurance continue to occupy an important role in the financial planning process today. The main aim of this article is to provide an introduction to this process and feature the means by which life and health insurance can assist in realizing one's financial plans.
 In this way a personal financial planning can be considered the process where an individual or a family decided to develop and perform a complete plan for realizing their objectives. The identification of financial aims and the development of an entire plan for realizing the objectives are the indispensable elements of this financial planning idea.
There are many serious dangers, such as property losses from fire and windstorm, and personal losses from disability and death, and humans are unprotected to them. People can only provide against their financial effects, but they cannot divine or preclude completely the occurrence of these dangerous events at all.
To protect against such misfortunes by having the losses of the unfortunate few paid by the contributions of the many who are unprotected to the same danger, is the main function of insurance.
Thus, the entity of insurance is the sharing of losses and, in the process, the replacement of a certain small loss (that is to say the premium payment) for an uncertain, large loss.
In any case if in the danger under consideration is that of the death, the financial loss suffered can be reduced through life insurance. The financial loss can be compensated by the health insurance if the danger is instead disability.
It is interesting but insurance may be defined from two perspectives: that of the society and that of the individual. Life or health insurance, from the society’s point of view, may be defined as a social means where individuals transfer the financial risks associated with loss of life or health to the group of individuals, and which involves the conglomeration of funds.
Moreover, this idea means that the insurance exists when there is a transfer of the risk from the individual to the group.
From the individual's point of view, life or health insurance may be defined as an agreement where one party pays a stipulated consideration (the premium) to the other party (the insurer), and, of course, in return for which the insurer agrees to pay a defined amount of money if the person whose life is insured dies or suffers an illness to a stated time.
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