What is the primary purpose of a life insurance policy?

The primary purpose of a life insurance policy is to cover potential financial losses upon the insured's death. Life insurance is designed specifically to provide financial protection to beneficiaries when the insured passes away. This financial support can help cover expenses such as funeral costs, outstanding debts, and lost income, ensuring that loved ones are not left with a financial burden in the event of the policyholder's death.

While some policies can have elements that contribute to savings or investment, their main function remains the provision of financial security and peace of mind for the insured's family, making option B the correct choice. This differentiates life insurance from other financial products such as retirement savings plans or investment vehicles, which have different primary functions.