Can You Take Out a Life Insurance Policy On Anyone?
Key Takeaways
- You can’t take out a life insurance policy on anyone without their knowledge and consent.
- The applicant must have an insurable interest, meaning they would face financial loss if the insured person passed away.
- Common examples include spouses, parents and children, or business partners.
- Consent and truthful information are required during the application process.
- Trying to insure someone without meeting these requirements isn’t just unethical, it’s illegal.
Can You Take Out a Life Insurance Policy on Another Person?
You can, but not at will. Life insurance applications must meet two key requirements: insurable interest and consent. Both exist to ensure that policies are purchased for legitimate financial protection, not speculation or gain.
Can Someone Take Out a Life Insurance Policy on You Without You Knowing?
No. Life insurance policies require the consent of the person being insured. That means you have to be aware of the application, provide accurate personal information, and usually sign the paperwork yourself. Life insurance companies also verify identity and medical information, making it nearly impossible to take out a policy without the insured person’s knowledge.
If someone tried to apply without your consent, it would be considered insurance fraud. These laws protect individuals from being insured for financial gain without their permission or legitimate financial interest.
How to Buy Life Insurance for Someone Else
Buying life insurance for another person is possible when there’s a clear financial or emotional connection. You’ll need their participation in the process, including consent and basic personal details such as birth date, income, and health information.
Parents often purchase policies for their children, and adult children sometimes help their parents secure coverage to handle final expenses. Business partners also use life insurance to protect shared financial interests. The key is transparency. Both people should understand who owns the policy, who pays the premiums, and who receives the death benefit.
What Is Insurable Interest and Why It Matters
Insurable interest is what gives someone the legal right to purchase life insurance for another person. It means you would face a real financial or emotional loss if that person passed away. Without it, an application can’t move forward because the policy could be seen as a way to profit from someone’s death instead of protecting against loss.
This helps ensure life insurance is used for its true purpose: financial protection. It’s the reason you can buy coverage for your spouse, parent, or business partner, but not a casual acquaintance or public figure.
Who You Can Take Out Life Insurance On
You can buy a life insurance policy on someone else when there’s a clear financial or emotional connection, and when that person agrees to the coverage. Here are some common relationships where this usually applies:
| Relationship | Typically allowed? | Rationale |
|---|---|---|
Spouse/partner | Yes | You share income, debts, and long-term financial goals. Most couples can legally take out life insurance on each other. |
Minor child | Yes | Parents or legal guardians can purchase coverage for children to protect against final expenses or future insurability concerns |
Elderly parent | Yes | Adult children can often take out coverage to handle funeral costs or outstanding debts, with the parent’s consent. |
Adult sibling | Sometimes | Allowed if there’s a demonstrated financial connection, such as shared caregiving or co-signed debts. |
Business partner | Yes | Common in “key person” or buy-sell agreements, where each partner protects the other’s financial role in the company. |
Ex-spouse (with shared obligations) | Sometimes | May qualify if there’s an ongoing financial dependency, such as alimony or shared debts. |
Employee | Rarely | Only allowed if the business has a documented financial stake, such as executive or key-person insurance. |
In general, if two people share financial responsibility or dependency, insurable interest is usually clear and coverage is allowed.
Who You Can’t Take Out Life Insurance On
You can’t buy life insurance for just anyone. If there’s no clear financial or emotional connection, or if the person doesn’t give consent, the application will be denied. These limits exist to prevent fraud and protect people’s privacy.
You cannot take out a policy on:
- Strangers or acquaintances: there’s no insurable interest or consent.
- Celebrities or public figures: personal admiration doesn’t create financial connection.
- Friends with no shared financial ties: emotional connection alone isn’t enough. You’d need to have a financial connection as well.
- Anyone who refuses to sign or provide required information: consent is legally required for every policy.
The rule is simple: if someone’s death wouldn’t cause you measurable financial loss, you can’t insure them.
Read: Best Life Insurance Companies for Young Adults (2025)
Expert Tip
Why You Can’t Just Buy Life Insurance on Anyone You Want?
Life insurance is meant to protect the people and relationships that truly matter. Insurable interest and consent are legal safeguards designed to keep life insurance fair, transparent, and ethical for everyone involved. They ensure policies are about care, not control or profit. When used the right way, life insurance offers peace of mind and genuine protection for those who depend on you most.
Senior Director Life Underwriting
Common Myths About Insuring Someone Else
Even though life insurance rules are straightforward, a few common misconceptions still persist. The table below clarifies what’s true and what’s not when it comes to insurable interest and consent:
| Myth | Truth |
|---|---|
If I pay for the policy, I can insure anyone | False. Paying premiums doesn’t override legal requirements. You still need insurable interest and the person’s consent for a policy to be valid. |
I can buy coverage for a relative without telling them. | Not true. Every life insurance policy requires the insured person’s knowledge and signature during the application process. |
Emotional ties are enough to prove insurable interest. | Not always. You must show financial or legal dependency, not just affection or friendship, to qualify for coverage. |
FAQs on Getting Life Insurance for Someone Else
No. You can only take out a life insurance policy on someone if you have both their consent and an insurable interest in their life. That means you’d experience a financial or emotional loss if they passed away, such as a spouse, parent, or business partner.
Yes. Every policy requires the insured person’s knowledge and written consent. They’ll typically need to provide personal details or complete a short health form before coverage begins. Without their participation, the application can’t move forward.
Insurable interest exists when you’d face financial hardship if the insured person died. Family members, spouses, or business partners often qualify because they share income, debts, or obligations. Without that connection, the insurance provider will deny the application.
Naming a beneficiary simply decides who receives the payout when you die. Taking out an insurance policy on someone else means you’re the policy owner, paying for life insurance coverage on another person’s life. In both cases, the death benefit payout only goes to the named beneficiary once the insured person passes away.
Yes, as long as they agree and you can show insurable interest. Many adult children take out modest coverage to handle funeral costs or remaining medical bills. The key is that your parents or grandparents must participate in the application.
If the person won’t sign or doesn’t want coverage, you can’t proceed. Their consent is required for every policy. You might consider helping them apply instead, but the decision has to be theirs.
Yes. Doing so without their knowledge or consent is considered insurance fraud. The safeguards built into every application process are designed to prevent that kind of abuse and protect both parties involved.
If you don’t have insurable interest, the insurer will deny your application. Even if a policy somehow gets issued, it could later be voided. Insurable interest protects against misuse and ensures life insurance remains a tool for real financial protection.
Author
Chief Underwriter
Expert review
Chief Compliance & Privacy Officer
Oct 27, 2025
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