What is the main purpose of insurance?

The main purpose of insurance is to transfer the risk of loss from an individual or business to an insurance company. When a person or entity purchases insurance, they are essentially paying a premium in exchange for the assurance that the insurer will cover certain financial losses that may occur due to specified risks, such as accidents, natural disasters, or liability claims. This transfer of risk provides policyholders with peace of mind, knowing that they will not bear the full brunt of financial losses alone. By pooling together many policyholders, insurers can spread the risk and ensure that individuals and businesses have financial protection against unexpected events.

The other options may represent various financial services or objectives, but they do not align with the fundamental purpose of insurance, which is focused on risk management and protection rather than lending money, increasing debt, or managing governmental finances.