What is the primary purpose of life insurance?

The primary purpose of life insurance is to ensure financial support for beneficiaries upon the insured's death. Life insurance is designed to provide a safety net for loved ones, helping them to maintain their standard of living and manage financial obligations after the insured individual passes away. This support can cover costs such as funeral expenses, outstanding debts, and ongoing living expenses, thereby providing peace of mind to both the insured and their beneficiaries.

While there are other aspects and benefits associated with life insurance, such as potential tax advantages or the possibility of accumulating cash value, these do not reflect the fundamental goal of life insurance. The core function remains the provision of financial protection for the beneficiaries in the event of the insured's death. In contrast, alternatives like accumulating savings for retirement or covering living expenses, although sometimes associated with specific types of policies, do not capture the essential purpose of life insurance.