Which of the following statements describes one of the reasons individuals purchase life insurance?

Individuals purchase life insurance for various reasons, and one of the primary motivations is to create an immediate estate. Life insurance policies provide a death benefit that is paid out to beneficiaries upon the policyholder's death. This benefit can help ensure that loved ones are financially secure, covering expenses such as mortgage payments, education costs, and daily living expenses. By effectively creating an immediate estate, life insurance allows individuals to leave a legacy and support their beneficiaries, even if they have not built substantial financial assets during their lifetime.

The other statements do not accurately reflect the fundamental purposes of life insurance. While retirement planning and savings are important, life insurance is not primarily designed as a savings account for retirement. Similarly, life insurance does not offer discounts on health premiums or guarantee loan approvals; these are influenced by other factors unrelated to life insurance policies. Thus, the statement regarding the creation of an immediate estate captures the essence of why many choose to purchase life insurance.