Ask the Life Insurance Expert
QHow can you tell if someone has taken out a secret life insurance policy on you?
It's highly unlikely that anyone has taken out a secret life insurance policy on you. Why? The process of buying a policy makes it difficult for someone to do it without your knowledge.
Most policies require a medical exam for the person whose life is being insured. In addition, the insured is required to sign a consent form for the release of medical records. Even policies that don't require a medical exam require your signature, and often there's a follow-up call after the policy application is submitted.
In addition, a person applying for a life insurance quote on your behalf must have an "insurable interest" in you. An example is a spouse who relies on your income to survive or a business partner who depends on you to keep the enterprise afloat. In other words, your neighbor can't take out a policy on you.
However, it’s not entirely impossible for someone to buy a life insurance policy on you without your knowledge. For example, parents can buy a life insurance policy on a child under 15 without his or her signature. If they never inform the child about the policy, the child may never know the policy exists.
In addition, it's possible for a person with group life insurance through an employer to sign up a spouse for life insurance without the spouse's knowledge. Group life insurance policies don't pay out huge benefits, though. And until 2006 companies could take out policies on employees without the workers' knowledge, but controversy over those policies put an end to that practice.
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