Washington Life Producer Practice Exam

What type of coverage allows the policyholder to have more than one beneficiary?

1. Sole beneficiary coverage

2. Joint coverage

3. Multiple beneficiary coverage

4. Single named beneficiary coverage

The correct answer is: Multiple beneficiary coverage

Multiple beneficiary coverage refers to a type of life insurance policy that allows the policyholder to designate more than one beneficiary to receive the death benefit. This arrangement is particularly beneficial when the policyholder wishes to provide financial support to several individuals, such as family members or charities, upon their passing. In this type of coverage, the policyholder can specify the percentage of the benefit that each beneficiary will receive, which allows for flexibility in how the policy proceeds are distributed. This is crucial for ensuring that the intentions of the policyholder are fulfilled and that each designated beneficiary receives their intended share. The other options represent different types of beneficiary arrangements, such as sole or single named beneficiary coverage, which restricts benefits to one individual, and joint coverage, which typically covers two people under a single policy. However, these do not provide for multiple beneficiaries in the way that multiple beneficiary coverage does.