He serves the same purpose as the Turors in Candlekeep, and depending on how you speak to him will explain;
There are many things you can ask Kolssed about, but he will only answer one question. After that he will leave the area, never to be seen again, and you cannot re-initiate dialog as he leaves. Fortunately, he doesn't have anything very important to say. His purpose in the game may be simply to ease players' fears about strangers in wilderness areas.
"Well, a busy day for me today indeed. Strange noises throughout the night, and now a plethora of people strolling about the wood. You do look a touch more hospitable than the last two I met though. Well met, stranger. I am called Kolssed."
- Stand away from me! I've very little trust left after last night's events, and I'll not waste any on you!
- I apologize for the outburst, but I am in dire straits. Can you help me?
- Could you help me? My foster father and I were attacked last eve, and now I'm not sure where to go.
- I would have your assistance. I was ambushed in the night and I require whatever you can give.
- You saw two people in the wood? I was told to meet some friends at the Friendly Arm Inn. Perhaps they and the ones you met are one and the same.
- Why are you in the woods? I have heard nothing but how dangerous they are.