How does life insurance differ from accident and sickness insurance?

Life insurance is specifically designed to offer financial protection to beneficiaries upon the death of the insured individual. This type of insurance provides a death benefit, which is a lump sum payment intended to help the deceased's family cover expenses such as funeral costs, debt repayment, and ongoing living costs. The fundamental purpose of life insurance is to provide financial security in the event of an individual's passing, which distinguishes it from other forms of insurance, including accident and sickness insurance.

In contrast, accident and sickness insurance provides coverage for medical expenses and income replacement in the event of injury or illness. This means that while life insurance addresses mortality risks, accident and sickness insurance focuses on health-related risks that may prevent an individual from working or incurring significant medical expenses. This difference in focus between the two types of insurance underpins why the correct answer highlights the role of life insurance in providing funds upon death.