Question

which of the following is/are true regarding the ownership of life insurance

1. a policy can only be issued to the insured.

2. generally, assigning a policy requires proof that the insured is still "insurable" meaning still in good health.

3. only a person with an insurable interest, generally a relative, a business associate, or lender, can be named as a beneficiary

a. 1

b. 1 and 2

c. 3

d. all of the above

Answer 1

only c. 3 is correct statement.

explanation. a policy can be issued to any person who has insurable interest in the insured person. therefore policy can be purchase by relative , employer of employee etc. insurable interest means that the loss of life of that insured person will affect the policy taker financially.

second the once policy taken it does not affect the inbetween status of health of the insured person. In Starting the health issues are considered for the premium purposes. but in between any issued of health is the part of the policy.

True only a person with an insurable interest , generally a relative, a business associate, or lender can be named as a beneficiary and the value of the policy is transferred to the beneficiary on the death insured or maturity of the policy. These person should have insurable interest in the insured person.