If a Prime Minister dies in office, or in the case of a double disillusionment of Parliament, someone has to be appointed to take over the running of the country. 

This person is deemed to be the 'care-taker' until a new leader can be chosen.

In the case of the previous PM dying in office:
The nominated person is the acting head of state until his political party can appoint a replacement. This method ensures that the political party that was elected to power remains in power.

In the case of a double disillusionment of Parliament:
This person will run the country until a general election can be called and a new Prime Minister is elected.

In both cases because they are only an acting head of state their powers are limited.