Texas Life Agent Practice Exam 2025 – Comprehensive All-in-One Guide to Master Your Certification!

Naming an irrevocable beneficiary in a life insurance policy means that the beneficiary cannot be changed without their consent. This provision ensures that the rights of the irrevocable beneficiary are protected, as they have a legal claim to the death benefit of the policy. Therefore, any changes to the policy, such as changing the beneficiary or certain other adjustments, require the agreement of the irrevocable beneficiary. This adds a layer of security for the beneficiary but also limits the policyholder's flexibility concerning the policy.

The other options do not accurately reflect the nature of an irrevocable beneficiary. The coverage amount increasing is not a consequence of naming an irrevocable beneficiary; such changes are typically dependent on the terms of the policy itself or any additional riders. The ability to cancel the policy at any time is generally a feature of the policy itself and does not directly relate to the beneficiary designation. Moreover, the insured’s ability to change the policy’s terms freely is restricted by the choice to name an irrevocable beneficiary, emphasizing that the policyholder must navigate any adjustments with the beneficiary’s consent.