Yes, you're entirely correct. There are countless situations that people might find themselves short of money and an event like this ruins their finances.
For the grandparent, consider my scenario. My wife lost her job a few years ago and was unable to find a new one since then (apart from some low-paying unstable jobs now and then). During the course of these few years our savings were eaten bit by bit and we're now reduced to a situation where we live literally from month to month. We've reduced the expenses as much as we could (for example, no winter vacation this year or no eating out), but still my paycheck can barely cover monthly expenses. No savings left for rainy days. And I fear that an exceptional event might be ruinous for our finances. My two kids are too small to be aware of this, but it still pains me.
For the grandparent, consider my scenario. My wife lost her job a few years ago and was unable to find a new one since then (apart from some low-paying unstable jobs now and then). During the course of these few years our savings were eaten bit by bit and we're now reduced to a situation where we live literally from month to month. We've reduced the expenses as much as we could (for example, no winter vacation this year or no eating out), but still my paycheck can barely cover monthly expenses. No savings left for rainy days. And I fear that an exceptional event might be ruinous for our finances. My two kids are too small to be aware of this, but it still pains me.