Beneficiaries✓ Verified · outline & fact-checked · Sep 2026Difficulty 2/5
Which statement correctly contrasts beneficiary designation in group life insurance versus an individual policy?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
In group life insurance, the covered employee - the insured certificate holder - designates the beneficiary for the coverage on his or her own life, because the employee is the party whose life is insured. In an individual policy, the policyowner, who may or may not be the insured, makes the designation. The parallel is that the party holding ownership or the insured-interest rights over the coverage controls the designation. In both settings, the proceeds go to the named beneficiary and generally avoid probate.
Why the other options are wrong
- B) Group plans regularly allow beneficiary designations. Only some tax-qualified plans impose limited restrictions on who may be named.
- C) The employer sponsors the plan and holds the master policy, but it is not the beneficiary of an employee's coverage.
- D) Neither individual nor group policies require the beneficiary to be a family member. Any eligible person or entity may be named.
Memory hook
Group means the insured picks; individual means the owner picks.