Life Insurance✓ Verified · outline & fact-checked · Sep 2026Difficulty 2/5
The key difference between a revocable and an irrevocable beneficiary designation is that:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
With a revocable beneficiary, the policyowner may change the designation at any time without the beneficiary's consent. With an irrevocable beneficiary, the designation cannot be changed without that beneficiary's written consent because the irrevocable beneficiary holds a vested contractual interest in the policy. This distinction matters in estate planning and divorce settlements, where irrevocable designations are used to guarantee a benefit to a specific person.
Why the other options are wrong
- B) The policyowner owns the cash value regardless of the beneficiary type; beneficiaries have no ownership interest in the policy's cash value.
- C) Beneficiaries may be any person or entity the policyowner chooses; family relationship is not required for either type.
- D) The beneficiary's right to the death benefit arises only upon the insured's death, whether the designation is revocable or irrevocable.
Memory hook
Irrevocable = they must sign off before you can swap them out. Revocable = change anytime, no permission slip.