Under O.C.G.A. § 33-24-3(d), a Georgia corporation is treated as having an insurable interest in which of the following individuals?

Why C is correct

Under O.C.G.A. § 33-24-3(d), a corporation has an insurable interest in individuals holding at least 10% of its issued shares and in its directors, officers, and employees whose death might cause the corporation financial loss. The common thread is a pecuniary relationship: the corporation must stand to lose financially from the person's death. Residence, mere job applications, and ordinary vendor relationships do not create that pecuniary exposure.

Why the other options are wrong

• A) Residence in the company's county creates no pecuniary stake in the person's continued life.
• B) A mere employment applicant has no employment relationship yet, so no corporate insurable interest attaches.
• D) An ordinary vendor relationship supplies goods, not a legally recognized insurable interest in the vendor's life.

Memory hook

A company can insure those it counts on: 10% owners, directors, officers, key employees.

Why B is correct

Under O.C.G.A. § 33-24-3(d), a corporation has an insurable interest in individuals holding at least 10% of its issued shares and in its directors, officers, or employees whose death might cause the corporation financial loss. A former employee may be insured only to replace insurance being surrendered — never to add new coverage.

Why the other options are wrong

• A) A long-term employment contract is not the statutory test; the shareholder test and the potential financial loss test govern.
• C) A former employee's coverage may not be increased — it may only replace insurance being surrendered.
• D) Not every current employee qualifies; the death must be one that might cause the corporation financial loss.

Memory hook

Ten percent or a loss-causing role.