________ _______ of a life insurance policy is used extensively in estate-planning as well as business circumstances

• A. Joint ownership
• B. Third-party ownership
• C. Beneficiary ownership
• D. Public ownership

Answer: (B)

Ownership of a life insurance policy is who has control over it—the right to name beneficiaries, pay premiums, borrow against the cash value, and ultimately receive the death benefit. When the owner is someone other than the insured, this is called third-party ownership. This setup is common in estate planning and business because the policy can be held by a trust or by a company, allowing wealth transfer or business liquidity to be managed outside the insured’s personal estate. For example, a trust owning a policy on the insured can ensure funds go to heirs, while a business owning a policy on a key employee can fund a buy-sell agreement or provide liquidity if that person dies. The other forms of ownership describe different scenarios that don’t emphasize control by a non-insured party, which is why third-party ownership best fits the described use.