Life Insurance on a Parent Without Their Consent

If you purchase life insurance on one or both of your parents, you will need their consent to buy the policy. Buying a life insurance policy on a parent without their consent is illegal and considered insurance fraud. Because life insurance plans require a signature and confidential information you may not have access to, buying a new policy without their knowledge would be very difficult to do. 

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Life Insurance on a Parent Without Their Consent

Typically, when you buy life insurance, you are the policyholder and insured who names a dependent as a beneficiary who will receive the death benefits in the event you die. You can buy a policy that insures another person — one or both your parents — and names you as the beneficiary, but there are rules. 

To buy life insurance on someone else, you need to prove insurable interest — proof that you will suffer financially in the event of their death — for example, when one parent is a caregiver to your child while you work full time or you worry you might be faced with their debts in case they die. 

This will be challenging to prove if you’re an adult child purchasing a plan for a parent without their knowledge or input. You will need them to be involved in the application process, complete a medical exam and sign the life insurance policy agreement. The only exception is if you have the power of attorney to make the decision. 

Why You Shouldn’t Take a Life Insurance Out on a Parent Without Their Consent

For starters, buying life insurance on a parent without their consent is unethical and illegal. To place a policy in force, the insured must provide all the necessary personal information about themselves and verify their medical history. Buying a life insurance policy without your parent’s knowledge or permission is insurance fraud and can lead to canceled policies, lost money, denied claims and, in some cases, prosecution. 

You will have more success securing life insurance coverage for one or both of your parents if you help them through the application process and name yourself as the beneficiary. Even if your parents own the policy, you can pay the premiums and keep the policy up to date and in good standing. 

Alternatives to Buying Life Insurance on a Parent Without Their Consent

If you are worried about funeral costs and other end-of-life expenses for your parents, there are other options: 

• Savings: Set aside money for end-of-life costs for your parents and encourage them to pay into the savings account or set one up on their own that they can pay into. 
• Help them buy a policy: Talk with your parents about buying life insurance and naming you as a beneficiary.  
• Prepay: This is similar to establishing a savings account, except you would pay directly to the funeral home. 

There is one type of policy that is easier to secure on behalf of one or both of your parents called final expense insurance, also called burial insurance. The final expense insurance is a permanent policy that lasts until your parents die, as long as your premiums are paid. Although there are no medical exams, your parents will need to answer a few questions and give their consent.