What is the primary purpose of life insurance?

The primary purpose of life insurance is to replace lost income for beneficiaries. This means that in the event of the insured person's death, life insurance provides financial support to their dependents or beneficiaries. It aims to ensure that those left behind can maintain their standard of living, cover everyday expenses, and meet their financial obligations, such as mortgages, education for children, and other financial commitments.

While other options, such as investment growth or funding retirement plans, may be features of certain life insurance products, they do not represent the primary purpose of life insurance itself. Life insurance is fundamentally designed to provide financial security to loved ones after the policyholder's death, making it a crucial tool for financial planning and risk management. Covering healthcare expenses and retirement planning, while important financial considerations, are outside the main objective of life insurance.