When must an insurable interest exist in life insurance? both at the time of death and...

When must an insurable interest exist in life insurance?

both at the time of death and at the inception of the policy

only at the inception of the policy

only at the time the beneficiary is paid

only at the time of death

Expert Solution

The answer is Option B (only at the inception of the policy).

In case of life insurance, insurable interest must exist only at the time of inception of the policy. Insurable Interest is considered so that people are not making profits out of someone's death.

jeff jeffy answered 2 years ago

Part I. Choose true or false? Explain why? 1. In non-life insurance, insurable interest must exist...

Part I. Choose true or false? Explain why? 1. In non-life insurance, insurable interest must exist when risks occur. True or False? Explain and give an example? 2. Third party liability insurance belongs to non-life insurance. True or False? Explain and give an example? 3. Subrogation will be applying if insured losses are caused by the third party? True or False? Explain and give an example? 4. Principle of ulmost good faith only applies to the insured. True or False?...

Define “Insurable Interest”, identify why there is a requirement for “Insurable Interest” in an insurance policy,...

Define “Insurable Interest”, identify why there is a requirement for “Insurable Interest” in an insurance policy, and describe what an “Insurable Interest” is in Property & Casualty insurance and Life Insurance, and highlight the differences between the two.

Fund Life & Health insurance How does the law of insurable interest protect human life? (identifying...

Fund Life & Health insurance How does the law of insurable interest protect human life? (identifying the requirement of the law and insurance company and analyzing how it protects general public.) What factors make joint life an effective tool in the case of a buy-sell agreement? ( Explain how JL matches the need for buy-sell agreement timing and analyzing what riders in JL benefits in the situation of buy-sell agreement.)

Insurable Interest Patrick contracts with an Ajax Insurance Company, an agent for a $50,000 ordinary life...

Insurable Interest Patrick contracts with an Ajax Insurance Company, an agent for a $50,000 ordinary life insurance policy. The application form is filled in to show Patrick’s age as thirty-two. In addition, the application form asks whether Patrick has ever had any heart ailments or problems. Patrick answers no, forgetting that as a young child he was diagnosed as having a slight heart murmur. A policy is issued. Four years later, Patrick becomes seriously ill and dies. A review of...

Is life insurance simply a death benefit?

In all types of insurance one party must have such an insurable before a contract of...

In all types of insurance one party must have such an insurable before a contract of insurance can be purchased on or for another party. agent interest indemnity risk Which of the following can be treated by the risk management process? static risks dynamic risks static risks and dynamic risks Enterprise risk Which of the following deals with Tort Law and the concept of Negligence? property insurance business insurance liability insurance life insurance

Please explain why Which of the following people have an insurable interest in Mike’s life? A....

*Please explain why* Which of the following people have an insurable interest in Mike’s life? A. Angel, Mike’s 25-year old daughter B. James, Mike’s 30-year old son C. Cassie, Mike’s ex-wife and angel’s mother D. John, Mike’s employer E. Donna, Mike’s daughter in law F. Scott, Mike’s business partner G. Rite, Mike’s fiancée

Insurance companies take risks. When they insure a property or a life, they must price the...

Insurance companies take risks. When they insure a property or a life, they must price the policy in such a way that their expected profit enables them to survive. They can base their projections on actuarial tables, but the reality of the insurance business often demands that they discount policies to a variety of customers and situations. Managing this risk is made even more difficult by the fact that until the policy expires, the company won

The options for the disbursement of life insurance death proceeds include all of the following EXCEPT:...

The options for the disbursement of life insurance death proceeds include all of the following EXCEPT: Leave with insurer to pay interest Paid in one cash payment Use to purchase paid-up insurance for the beneficiary Paid as a life income to the beneficiary, with a certain number of payments guaranteed

A life insurance company invests $7000 in a bank account in order to fund a death...

A life insurance company invests $7000 in a bank account in order to fund a death benefit of $28 comma 000. Growth in the investment over time can be modeled by the differential equation below, where i is the interest rate and A(t) is the amount invested at time t (in years). Calculate the interest rate that the investment must earn in order for the company to fund the death benefit in 36 years. dA over dt = Ai

Question