What is a primary purpose of life insurance?

A primary purpose of life insurance is to provide financial support to beneficiaries upon the insured's death. This is fundamentally what life insurance is designed to do: it ensures that the financial needs of dependents, loved ones, or beneficiaries are met in the event of the insured's passing. The death benefit received can help cover various responsibilities, such as mortgage payments, outstanding debts, living expenses, and other financial obligations, allowing the beneficiaries to maintain their standard of living during a difficult time.

While life insurance may have other secondary benefits, such as acting as a means to accumulate cash value or contributing to estate planning, its primary objective is to replace the insured's income and provide a safety net for their loved ones after their death. This focus on beneficiary support highlights the crucial role life insurance plays in financial planning, especially for those with dependents or significant financial responsibilities.