3.8 Rights of Ownership
Policyowners have distinct rights that are not available to others. Of course, you've learned that the policyowner has the right to change the beneficiary or to even sell the policy (called assignments). Other rights that are exclusively the policyowners are:
- the decision on choosing and changing the beneficiary;
- the decision on just how the death benefits will be disbursed to the beneficiary;
- the right to policy loans;
- the right to policy dividends and their disbursement method;
- the right to assign ownership of the policy to someone else; and even
- the right to cancel the policy and select a nonforfeiture option.
After we look at some of the standard provisions, we will take a look at what is excluded. Exclusions are designed to reduce the insurance company's liability. Since these two sections of a policy outline the protection the insured can expect to receive, it is important to pay special attention to what these provisions imply. Instead of purchasing a life insurance policy that does not quite meet the insured's needs, it can be amended and customized by attaching insurance riders.
