Life & Health Insurance Exam (National Portion)Policy Provisions, Options, and RidersMedium
A health insurance policy includes a 'Change of Beneficiary' provision. Which of the following statements is true regarding this provision?
- AThe beneficiary can only be changed if the policy is currently in its grace period.
- BThe beneficiary can only be changed with the written consent of the current beneficiary.
- CThe insurer has the sole right to approve or deny any request for a beneficiary change.
- DThe policyowner can change the beneficiary at any time without the beneficiary's consent, unless the beneficiary designation is irrevocable.
Show answer & explanationAnswer & explanation
Correct answer: D. The policyowner can change the beneficiary at any time without the beneficiary's consent, unless the beneficiary designation is irrevocable.
Unless an irrevocable beneficiary has been designated, the policyowner generally has the right to change the beneficiary at any time without needing the current beneficiary's consent. This is a standard right under most insurance contracts.
Why the other options are wrong
- A. The ability to change a beneficiary is not tied to the policy's grace period.
- B. This is only true for irrevocable beneficiaries, not for revocable ones.
- C. The insurer processes the change, but the right to change belongs to the policyowner, not the insurer.
Change of Beneficiary Provision
A standard provision in insurance policies that allows the policyowner to change the designated beneficiary.
- Policyowner typically has this right.
- Revocable beneficiary can be changed at any time by the policyowner.
- Irrevocable beneficiary requires their consent for a change.
Memory trick: The 'OWNER' always rules, unless they gave away their power.