Who can an applicant have an insurable interest in?

An applicant can have an insurable interest in a sibling because insurable interest is typically based on a close relationship that would result in financial loss or hardship to one party if the other were to pass away. Siblings generally share a strong familial bond, and this connection implies that one would be financially affected by the loss of the other. Insurance is founded on the principle that one must have a vested interest in the life or health of the insured, ensuring that the policyholder has a legitimate reason to seek the insurance coverage.

In comparing other relationships, while it is conceivable that a cousin, an in-law, or a friend could have a degree of insurable interest, the degree of financial dependency or loss is usually less significant compared to that between siblings. Siblings often have shared financial responsibilities, shared living arrangements, or emotional ties that can translate into insurable interest in a way that is more direct and impactful. Thus, the relationship with a sibling aligns well with the requirement of insurable interest in the context of life insurance.