Tennessee Insurance Complete Practice Exam 2025

The situation that requires a policyholder's permission for changes to be made on an insurance policy centers around the need for the policyholder's consent regarding the designation of beneficiaries. Changing beneficiaries involves altering who will receive the policy's benefits upon the insured's death, which is a significant decision that directly affects the financial interests of the policyholder and their intended recipients. Therefore, the insurance company must ensure that the policyholder explicitly approves this change.

In contrast, while transferring ownership of a policy, increasing coverage limits, or adjusting premium payments may involve various administrative procedures or considerations, they do not necessarily require the same level of personal authorization from the policyholder as changing beneficiaries does. Ownership transfers often follow specific guidelines set forth in the policy, and adjustments in coverage or premiums can typically be made according to the terms established within the agreement, provided proper notification is rendered.