In an irrevocable beneficiary designation, whose consent is required for policy loans?

• A. The policyowner may take loans without consent.
• B. The beneficiary's consent is required for loans.
• C. Loans cannot be taken under any circumstance.
• D. The insurer must approve all loans.

Answer: (B)

With an irrevocable beneficiary designation, the named beneficiary has a vested right to the policy’s proceeds. Because taking a loan against the policy can reduce the cash value and, if unpaid at death, reduce the death benefit payable to that beneficiary, the beneficiary’s consent is required before a loan can be taken. This protects the beneficiary’s guaranteed interest in the policy’s payout.

If the designation were revocable, the policyowner could generally borrow without needing the beneficiary’s consent, though there would still be implications for the death benefit. The insurer’s approval isn’t the controlling factor here, and loans aren’t prohibited outright.