State RegulationsGA specificDifficulty 2/5
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?
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Answer & full 3-part explanation (select an option above, or peek)
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.