It's a free rider where if you become terminally ill and your physician says you have 12 months or less of mortality then you can accelerate or take your life insurance early, typically 90 to 100 percent of your face amount
In general, you can buy a life insurance policy on someone only if you have an insurable interest meaning you would suffer a financial loss if they passed away and they consent to the policy.
Common examples include:
Yourself
Your spouse
Your children
A business partner
A key employee
Someone who has co-signed a loan with you or on whom you are financially dependent
You can buy life insurance on anyone who has insurable interest, ex. a spouse, child/legal dependent, parent or grandparent, siblings, cousin, civil union, or domestic partners.
You can only buy a life insurance policy on someone else's life IF you have an "insurable interest" in their life and they consent to such insurance. You must stand to suffer a clear financial or emotional loss if that person were to pass away. Most often those people are: yourself, your immediate family members, and if you own a business - your business partners or key employees.
You can always buy a life insurance policy on either yourself, or someone whom you have an insurable interest in, you Spouse, Children Parents, and even business partners, key employees. Essentially, anyone, who if they pass away would have you suffer a personal or financial loss in doing so.
