Can some one take out a life insurance policy on you without notifying you?

Question

Is an insurance company legally required to notify the person who's life is being insured? If not is there any way to see if a policy has been taken out in your name?

Answer 1

No. You determine your own benificiary. Some states have laws that require that your spouse be your benificiary, but they can't do this without your knowledge.

Answer 2

No they are not legally required to notify a person who is being insured. Anyone can take out a policy on anyone else. Depending on the type of insurance, only someone who has an 'interest' in the person can do so. For example, the Gerber Baby Insurance, only parents and grandparents can utilize that particular insurance for their children or grandchildren. No, there isn't a way to see if a policy has been taken out in your name, unless you contact every agency doing business on earth. By the time you got through the list, you'd be dead and maybe someone collected on you and maybe someone didn't.

Answer 3

The simple answer is 'No'. There are three parties to a life insurance policy:-
The Life Insured
The Proposer
The Beneficiary

This could be the same person who insures themselves for their own benefit so in the event of death the value of the policy goes to the estate to be distributed according to the Will.

Alternatively the Proposer could be a second person, such as a wife or husband, and the beneficiary could be someone else. This often happens where there may be death duties payable so the money is paid outside the estate sop it can be used to pay the duties and release the estate.

In every case the proposer MUST have an 'insurable interest' in the life assured or the insurance is not valid. Since the Proposal Form normally has to be signed by both the proposer and the life assured it would not be possible for you to be insured without your knowledge without fraudulent means. All insurance is based on the principle of 'uberimae fidei' or 'utmost good faith' so in the event of a fraudulent application the policy would be invalid.

The only exception I can think of is where a company takes out a blanket policy on the lives of it's employees so the in the event of the death of one of them the company is compensated for his loss.

Answer 4

All those that have said no are actually incorrect. It is, in fact, possible to take out a life insurance policy on someone without their knowledge. The owner of a policy doesn't have to be the same as the person who is being insured. All the owner has to have is an insurable interest in the person being insured. And a medical sample only has to be taken on an insured above a specific face value, determined by the particular company's underwriting standards.

With that said, it's very rare for a person to not know that someone has an insurance policy on them, but it is possible.

Of course, that is always dependent upon state regulations. Some states may require notification, but some may not. So, you would need to check with your state insurance department.

Answer 5

I once had the option of purchasing a life insurance policy on my husband through my employer, and I asked that same question. I found out that you don't necessarily have to be notified (although some programs do require a physical and whatnot), but, like everyone else said, there does have to be insurable interest. Your spouse, parent, or grandparent--and in some cases your children--can take out a policy on you without your knowledge. I actually read (in Dear Abby, perhaps) about a grandmother who had bought a policy on her own grandson after he had gotten a few tickets in a short period of time. The grandmother told the insurance people that it was to cover the final expenses should the need arise. Anyway, the boy was involved in a fatal crash, Grannie kept the check, and his parents were stuck with the bill. Sad.

Answer 6

Actually you can take a life insurance policy out on someone without them knowing it. But you would have to know them pretty darn well to be able to do it. You usually need a social security number and some companies require a medical exam but some do not. If you think you know the name of the company where the policy was taken out you could probably call and ask. Also, you probably couldn't take out more than a few thousand dollar policy without a medical exam. You can sign up for insurance without an insurance agent seeing you. I currently have life insurance and the agent never saw me. I did it by mail. I actually never spoke to anyone until I cancelled it.

Answer 7

I think you could, in the past. Recently, I heard that insurance companies are notifying the person insured because of some murder cases that involved high life policies taken out by the insured person's heir(s).
I suppose you could check to see what policies are out on yourself, but you would need to go through all the companies. Maybe there is some sort of search engine for that somewhere.

Answer 8

Only if they do it fraudulently.
The named insured must sign the application, even if he/she is not the owner of the policy. Furthermore, the agent must see the named insured for purposes of fraud, and to verify, as best as he/she can in the field, that the named insured is healthy. Some small death benefit plans do not require the named insured to have a medical exam, but others do. Unless you knew the name of the company - there are too many life insurance companies out there! - there would be no way (at least not this year) that youd could find out.

Answer 9

No, you cannot take a policy out on the life of someone else without their consent. And, even with their consent, you must has some financial interest in that persons life. It's called "Insurable Interest." A Husband and Wife have insurable interest in each other's lives and in the lives of their children. Business partners have an insurable interest in each other for the sucess or failure of the business. A lender has an insurable interest in a borrower to the extent of the indebtedness.

In some cases, charitable organizations have an insurable interest in large donors, but that is not so clear and not the same in all states.

But in almost every case, except for minor children of the policyowner, the insured must sign the application for insurance, and must submit to medical underwriting requirements to determine the rating classification for that persons health and financial status, as well as the relationship to the person who will own the policy.

Grampy

Answer 10

Many of these people are right when mentioning "insurable interest". However it is exactly the lack of insurable interest that can get you a policy if you are to be the owner and someone else the beneficiary. And it doesn't necessarily have to be a spouse but it will add additional underwriting concerns if you don't list them as primary or equal beneficiaries with others. I am retired now, but used to an MDRT insurance producer, but there used to be a company, called Confidential Life, check it out with them.

Answer 11

I agree with everything being said. But with the internet processing these days, there are certainly loopholes in the system and theoritically you could get a policy without the person ever knowing. Paying off might be a different story and if at any point they discover it was fraud would only be liable for return of the premiums paid and not the benefit amount.

It would also depend on the amounts. Larger policies are going to get more scrutiny than the $10K colonial penns.