SSL certificates provide encryption for websites to securely transmit sensitive information between a server and web browser. When a user visits an HTTPS website, the browser and server establish an encrypted connection called an SSL handshake using public and private keys. This ensures data transmission cannot be intercepted. SSL certificates must be purchased from certificate authorities and installed on web servers to validate a domain's identity and allow HTTPS encryption. They are especially important for e-commerce sites collecting credit cards and sites with login sections to protect user data.