Ownership rights in a life insurance policy include all of the following EXCEPT?

• A. to reinstate the policy after a lapse.
• B. to exchange a policy for another policy.
• C. to elect settlement options.
• D. to rescind an absolute assignment.

Answer: (D)

Ownership rights are the powers a policyowner has to control the policy during life. These include keeping or reinstating the policy if it lapses, exchanging the policy for a different one, and choosing how benefits are paid after death (settlement options). An absolute assignment, by contrast, permanently transfers all ownership rights to another person. Once that transfer is complete, the original owner no longer controls the policy, so there isn’t a right to undo or rescind that assignment as an ownership privilege. The ability to rescind would apply only to certain less permanent (revocable or collateral) arrangements, not to an irrevocable absolute assignment. Hence rescinding an absolute assignment is not an ownership right.