What is the primary risk covered by life assurance?

Life assurance primarily covers the risk of premature death of the insured. This type of insurance is designed to provide financial protection to the beneficiaries of the policyholder in the event that the insured individual dies unexpectedly, potentially leaving dependents without a source of income or financial support.

The primary aim of life assurance is to help mitigate the financial impact that such a sudden loss can have on loved ones, ensuring that they have the necessary funds to cover expenses like mortgage payments, education costs for children, or day-to-day living expenses. This ensures the continuity of financial stability for those who relied on the deceased for their income.

In contrast, the other options focus on risks that are not within the primary scope of life assurance. Property damage pertains to insurances like homeowner’s or renter’s insurance, loss of income can be more closely associated with disability insurance, and the risk of investment failure deals with investment products like mutual funds or stocks, which are not related to life assurance.