Ace the Florida Life & Health Insurance Test 2025 – Dive In and Secure Your Success!

In a life insurance contract, insurable interest must exist at the inception of the contract. This means that the person taking out the policy must have a financial interest in the life of the insured. This ensures that the insurance policy is not being taken out for fraudulent reasons.

Option B is incorrect because insurable interest must exist when the contract is entered into, not just at the time of claim. Option C is incorrect because the insurable interest must remain throughout the policy term, not just at certain points in time. Option D is incorrect because insurable interest is required from the beginning of the contract, not just after it has lapsed.