What is the life insured (life assured) on a policy?
The life insured, also called the insured or the life assured, can be the policyholder or someone else. A trust or company can hold a policy on the life of a family member, director or key employee, provided it has an insurable interest in that life. Underwriting looks at the life insured: medical evidence, smoking status, occupation, hobbies and country of residence all bear on the offer.
International IUL is written on one life insured per policy, and life-pay premiums stop on that person's death. When the life insured dies, the insurer pays the death benefit, less any outstanding policy loan, to the beneficiary. In a PPLI structure the roles are the same: the death benefit becomes payable on the death of the life insured, and a trust or foundation that holds the structure passes it on under its deed or charter.
The life insured, or life assured, is the person whose death triggers payment of the death benefit. Their age, health and lifestyle set the underwriting terms and the cost of insurance.
