Question

Explain the difference among the insured, the owner and the beneficiary of a life insurance policy. Give a specific example in which each party might be a different person.

Answer 1

The owner of the policy can also be the person insured. Sometimes, the owner might not be the person insured, in such a case, the ownership  of the policy is given to a trust. In case the owner of the policy dies, then the proceeds of the claim is usually given to it's beneficiaries.

The insured is the person, for whom the policy is purchased.

The owner of the policy, is the person who owns the policy and has ownership claims over it.

The beneficiary is the person, who can claim the benefits of the policy.

For example, if a company purchased a health insurance for it;s employees,'

In this case the owner of the policy is the company, the person insured is the employee and the beneficiary of the policy can be the son/daughter/wife of the employee.