Can You Buy Life Insurance on Someone You Don’t Know or Like?
Have you ever wondered if you could buy a life insurance policy on someone you don’t know, like an aging actor or rock start who doesn’t appear to be in good health? What if you could buy a life insurance policy on someone who you didn’t care for and benefit from their death? Can you, indeed, buy a life insurance policy on someone you don’t know or like?
There are really two different questions here, with two different answers. Let’s take a look.
First and foremost, you must have an “insurable interest” in anyone you buy life insurance for. This means you must be able to show that you would be negatively impacted financially by their loss. In the case of someone you do not know, that is unlikely. You would also need their consent, which is also unlikely.
Now, when it comes to the question of whether or not you can buy life insurance on someone you don’t like, the answer is yes, provided certain conditions exist. Let’s say you have a business partner that you don’t necessarily get along with, yet, they play an important role in your financial future. You could, in theory, take out a life insurance policy on them to protect your interests, as long as they consent to it. In fact, insuring partners is often a good business practice if all partners are insured. Spouses are sometimes unlikeable, but they would still be able to insure each other, with permission, of course.
Can you insure another family member like an old aunt or uncle? Not likely, unless you can demonstrate a financial loss would occur in the event of their death. Whether you like them or not, a family member’s death would have to negatively impact you for you to purchase insurance on their life. You would also still need their consent.
The insurable interest aspect of life insurance prevents people from “betting” on the lives of people they don’t know. It also may serve as a deterrent for those who may have more devious ideas.
There are many reasons to insure a life but financial gain shouldn’t be one of them. Contact one of our independent insurance agents to discuss your legitimate needs or to get a quote today.