Life Insured

The life insured is the individual whose life is covered under a life insurance policy. If the life insured passes away, the insurer pays the death benefit to the designated beneficiary or to the policyholder, depending on the policy structure. The life insured may or may not be the same person as the policyholder. For example, a spouse, parent, or business partner may own a policy that insures another person’s life.

The risk assessment for the policy is based on the life insured’s age, health, occupation, and lifestyle. These factors determine eligibility, premium cost, and policy terms. The insurer’s obligation to pay the death benefit is tied directly to the life insured’s status and the policy being active at the time of death.

Example:

If a parent purchases a $250,000 life insurance policy on their own life, they are both the policyholder and the life insured. If they buy the policy to cover their adult child, the child becomes the life insured, while the parent remains the policyholder and may name themselves as the beneficiary.

What to Watch For:

Confirm who is listed as the life insured on each policy, as this determines when and how benefits are paid. Only the policyholder has the authority to make changes, such as updating beneficiaries or canceling coverage. Ensure that the information about the life insured, including health and personal details, is accurate at the time of application to avoid claim issues.