West Virginia State Life Insurance Practice Exam

Which type of life insurance beneficiary must give consent when the policy owner attempts to change the beneficiary?

1. Irrevocable beneficiary

2. Revocable beneficiary

3. Contingent beneficiary

4. Designated beneficiary

The correct answer is: Irrevocable beneficiary

An irrevocable beneficiary is a type of beneficiary designation in life insurance where the policyholder cannot change the beneficiary without the consent of that beneficiary. This means that if the policy owner wants to make any changes, such as switching beneficiaries or altering the benefits, they must obtain permission from the irrevocable beneficiary. This is a protective measure that ensures the beneficiary has a vested interest in the policy and cannot be simply removed or replaced at the policy owner's whim. In contrast, a revocable beneficiary can be changed by the policy owner without needing to seek permission, which provides more flexibility to the policyholder. Contingent beneficiaries are only entitled to benefits if the primary beneficiary is not available at the time of the policyholder's death, and designated beneficiaries are essentially just an identifier without implications for consent rights. Therefore, the nature of the irrevocable beneficiary’s designation expressly requires consent for changes, aligning perfectly with the question's requirement.