Which term describes the person who receives the proceeds of a life insurance policy?

Which term describes the person who receives the proceeds of a life insurance policy?

• A. Beneficiary
• B. Death benefit
• C. Indemnity
• D. Warranties

Answer: (A)

In life insurance, the person who receives the policy proceeds is called the beneficiary. The policy designates who will receive the death benefit—the amount paid when the insured dies. The beneficiary can be a person, a trust, or a charity, and you can name a primary beneficiary plus contingent beneficiaries who would receive the proceeds if the primary isn’t able to. This designation stays in effect unless the policy owner changes it. Indemnity is a general principle about compensating a loss to restore the insured’s financial position, not about who receives the money. Warranties are promises or guarantees about information on the application; they can affect coverage if misrepresented, but they don’t designate who gets the proceeds.

In life insurance, the person who receives the policy proceeds is called the beneficiary. The policy designates who will receive the death benefit—the amount paid when the insured dies. The beneficiary can be a person, a trust, or a charity, and you can name a primary beneficiary plus contingent beneficiaries who would receive the proceeds if the primary isn’t able to. This designation stays in effect unless the policy owner changes it.

Indemnity is a general principle about compensating a loss to restore the insured’s financial position, not about who receives the money. Warranties are promises or guarantees about information on the application; they can affect coverage if misrepresented, but they don’t designate who gets the proceeds.