What is the primary purpose of property insurance?

The primary purpose of property insurance is to protect against loss or damage to physical assets. Property insurance covers various risks, such as theft, fire, and natural disasters, ensuring that the financial burden associated with repairing or replacing damaged property is mitigated. This type of insurance provides peace of mind for property owners, knowing that their investment is safeguarded against unforeseen events.

In contrast, the other options address different aspects of financial protection. Income protection in the case of business failure relates to forms of insurance such as business interruption insurance, not property insurance, which specifically focuses on physical assets. Offering retirement benefits aligns with life insurance or pension plans rather than property insurance, which is exclusively concerned with tangible property. Additionally, while liabilities due to legal claims are critical for personal and business insurance, they are typically covered under liability insurance policies, not property insurance. Therefore, the focus on safeguarding physical assets clearly underscores the primary purpose of property insurance.