Who has insurable interest on the life of a relative?

Insurable interest in the context of life insurance refers to a scenario where an individual stands to benefit from the continued life of another person or would suffer a financial loss in the event of that person's death. This principle helps prevent insurance fraud by ensuring that individuals are only able to insure those whom they have a legitimate interest in.

Each of the scenarios presented highlights valid reasons a person might have insurable interest in the life of a relative. A child or grandchild would naturally have insurable interest because their well-being is often tied to the parental figures, who are responsible for their care.

Similarly, any person who is dependent on someone else, be it financially or in terms of care, has an insurable interest, as their support system relies on the life of the relative. This dependency establishes a legitimate reason to seek insurance coverage.

Furthermore, individuals with a financial interest in the life of a relative—perhaps because of business relationships or inheritance—also qualify. Financial ties, whether direct (like debts) or indirect (such as shared assets), can create significant interest.

Therefore, all the provided scenarios collectively represent cases of insurable interest, affirming that individuals may have legitimate reasons to insure the life of a relative based on dependency, care, or financial