Who benefits from an insurance policy?

The beneficiary named in the policy is the correct answer because this individual or individuals are specifically designated to receive the benefits provided by the insurance policy upon the occurrence of a covered event, such as the policyholder's death in the case of life insurance. The primary purpose of having a beneficiary is to ensure that the intended financial support or payout reaches someone who may rely on that financial assistance, thereby protecting their welfare after the policyholder's passing.

While the insurance company operates profitably by collecting premiums, its role is more about risk management rather than being a direct beneficiary. Similarly, the agent who sold the policy may receive a commission from the sale, but they do not receive the benefits of the policy itself. Although the policyholder’s family members may receive support if they are designated beneficiaries, it is ultimately the beneficiaries named in the policy who hold the right to claim the benefits directly from the insurer.