New Jersey Life Producer Law Practice Test

The term "beneficiary" in life insurance specifically refers to the individual or entity designated to receive the death benefit or proceeds from a life insurance policy upon the death of the insured. This designation is crucial as it determines who will benefit financially from the policy, ensuring that the intended recipient receives support at a critical time. It can be a family member, friend, charity, or even a trust.

In contrast, the issuer of the policy, often an insurance company, is not the beneficiary but rather the party that provides the coverage. The individual who pays the premiums is frequently the policyholder, who may or may not be the insured or beneficiary. Similarly, the underwriter is responsible for evaluating risk and determining the terms and costs of the policy, but they do not receive benefits from the policy; their role is more about managing the company’s risk rather than receiving claims. In this context, option C accurately captures the essence of what a beneficiary is in the realm of life insurance.