I have studied many times that "this is" (different devices for different circuits) required for isolation, but what is the actual need of isolation?

 

Two typical reasons for requiring isolation are safety and noise reduction.

For safety, high voltages need to be isolated from human contact such as the mains power in an appliance.

Isolation can be used to minimize noise in a circuit from ground loops or from a noisy source (such as noisy digital circuits from analog),