When does Ann need to demonstrate insurable interest for her life insurance policy?

For life insurance policies, an individual must demonstrate insurable interest at the point of purchase. Insurable interest means that the policyholder must have a valid interest in the continued life of the insured, typically because of a personal relationship or a financial stake in the person's life, such as a spouse, child, or business partner.

This requirement serves to prevent moral hazards and ensures that the policyholder would have a genuine reason to keep the insured alive, rather than profiting from a desire for their demise. Once a life insurance policy is in force, there is no additional need to prove insurable interest at the claims stage or during renewal, as the initial requirement is sufficient for the life of the policy.

Thus, the focus on demonstrating insurable interest solely at the point of purchase aligns with the principles underlying life insurance and its regulation.