Tennessee Insurance Practice Exam 2026 – All-in-One Resource for Exam Success!

The option that correctly identifies the type of beneficiary designation that allows a policyowner to permanently change the beneficiary on a life insurance policy is the irrevocable designation.

Selecting an irrevocable beneficiary means that once the designation is made, it cannot be changed without the consent of that beneficiary. This provides the beneficiary with a guaranteed interest in the policy, as they would receive the death benefit upon the insured's passing, unless they agree to a change. This contrasts with a revocable beneficiary designation, where the policyowner retains the right to change the beneficiary at any time without needing permission. It is essential to grasp this distinction to understand the implications of beneficiary designations on both policyownership and estate planning.

Contingent and primary beneficiaries are terms that describe different roles in beneficiary designations but do not inherently describe the ability to change a designation. The primary beneficiary is first in line to claim the benefits, while a contingent beneficiary is second in line, but neither designation implies permanence or the inability to change in the same way that irrevocable does.