New Jersey Life Producer Law Practice Test

The main difference between a revocable and an irrevocable beneficiary designation lies in how the policyholder can manage the beneficiary's status after the policy is in effect. With a revocable beneficiary, the policyholder retains the flexibility to change the beneficiary designation at any time without needing permission from the beneficiary. This gives the policyholder greater control over their life insurance policy and allows for adjustments as circumstances change.

In contrast, an irrevocable beneficiary designation locks in the beneficiary, meaning that the policyholder cannot change the beneficiary without the consent of that beneficiary. This type of designation is often used when the policyholder wants to ensure that a specific person will receive the death benefit, and by requiring consent for any changes, it provides a level of security for the beneficiary.

Therefore, the assertion that an irrevocable beneficiary cannot be changed without consent is accurate and highlights the key legal distinction between the two types of designations. Understanding this difference is crucial for individuals managing their life insurance policies, as it can affect estate planning and beneficiary rights.