# Can I take out a life insurance policy on a stranger?

**URL:** <https://boards.straightdope.com/t/can-i-take-out-a-life-insurance-policy-on-a-stranger/410480>\
**Category:** Factual Questions\
**Created:** [July 4, 2007, 8:29am UTC](https://boards.straightdope.com/t/can-i-take-out-a-life-insurance-policy-on-a-stranger/410480 "2007-07-04T08:29:40Z")\
**Posts on this page:** 4\
**Page:** 3

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**Author:** ![chowder](https://avatars.discourse-cdn.com/v4/letter/c/977dab/32.png) [@chowder](https://boards.straightdope.com/u/chowder)\
**Post date:** [July 5, 2007, 3:21pm UTC](https://boards.straightdope.com/t/can-i-take-out-a-life-insurance-policy-on-a-stranger/410480/41 "2007-07-05T15:21:26Z")

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[QUOTE=spifflog]  
I know is America today, we are rquired to love mom, apple pie and hate Walmart. But why is it scummy? The insurance icompany s letting WM take out the policy, presumably to make money. And WM isn’t going to kill the guy. What’s the big deal?  
[/QUOTE]

\>\>hijack\<\<\< Why are you taught to hate WM.

I don’t get this at all, it’s a store 😕

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**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\
**Post date:** [July 5, 2007, 3:34pm UTC](https://boards.straightdope.com/t/can-i-take-out-a-life-insurance-policy-on-a-stranger/410480/42 "2007-07-05T15:34:22Z")

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[QUOTE=Kalhoun]  
That scenario makes sense. What if you have a policy on a 4-year old child? Say the kid drowns or is hit by a car. No medical bills incurred. Will a policy pay in that case?  
[/QUOTE]

I had quoted a paragraph from Keeton & Widiss, and insurance law treaty, but the hamsters ate it. Let me summarize:

1. There will still be funeral costs. [http://www.iii.org/individuals/life/special/child/](http://www.iii.org/individuals/life/special/child/)

2. Courts are willing to relax the insurable interest doctrine somewhat in the case of family members. By extension, they don’t strictly apply the principle of indemnity to family member-life insurance.

3. In fact, life insurance, generally isn’t subject to the principle of indemnity, at least generally, in most states. If I’m the beneficiary of a $250,000 life insurance policy, I don’t have to prove up losses of $250,000 in order to recover full benefit. I just have to prove that the insured is dead.

4. There were some issues, historically, with child life insurance.\* It was sold door-to-door based on the funeral costs theory. Parents would buy it and pay premiums with money they could have spent on medical care and food.

\*based on an insurance law lecture from long ago given by this guy [Newsroom - The Source - Washington University in St. Louis](http://news-info.wustl.edu/sb/page/normal/733.html) . I could be misinformed or have it all jumbled up in my head.

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**Author:** ![Mr.Slant](https://avatars.discourse-cdn.com/v4/letter/m/c57346/32.png) [@Mr.Slant](https://boards.straightdope.com/u/Mr.Slant)\
**Post date:** [July 5, 2007, 5:17pm UTC](https://boards.straightdope.com/t/can-i-take-out-a-life-insurance-policy-on-a-stranger/410480/43 "2007-07-05T17:17:06Z")

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[QUOTE=chowder]  
\>\>hijack\<\<\< Why are you taught to hate WM.

I don’t get this at all, it’s a store 😕  
[/QUOTE]

Google  
Wal-Mart sucks  
and spent 15 minutes reading the results.

It’s complicated, and the answer is off-topic in this thread.

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**Author:** ![OneCentStamp](https://avatars.discourse-cdn.com/v4/letter/o/13edae/32.png) [@OneCentStamp](https://boards.straightdope.com/u/OneCentStamp)\
**Post date:** [July 5, 2007, 5:19pm UTC](https://boards.straightdope.com/t/can-i-take-out-a-life-insurance-policy-on-a-stranger/410480/44 "2007-07-05T17:19:27Z")

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[QUOTE=Rick]  
What financial loss will you suffer if the pope takes a dirt nap? :dubious:  
[/QUOTE]

He sells t-shirts with the Pope’s face in one of those _Ghostbusters_-style red crossout circles. New pope = lots of unsellable inventory. 🆒

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