What type of insurance covers loss of life and provides a death benefit?

Life insurance is specifically designed to cover the loss of life and provide a death benefit to the beneficiaries of the insured individual. This type of insurance ensures that, in the event of the policyholder's death, a predetermined sum known as the death benefit is paid out to designated beneficiaries. This financial support can help cover expenses such as funeral costs, outstanding debts, and ongoing living expenses for the loved ones left behind.

In contrast, health insurance primarily covers medical expenses and does not provide death benefits. Property insurance protects physical assets against risks such as theft or damage but has no implications for loss of life. Liability insurance offers coverage against claims resulting from injuries or damages to other people or their property, which also does not relate to providing benefits upon death. Thus, life insurance is uniquely positioned to fulfill the need for financial protection in the event of the policyholder's untimely demise.