Generally, an insured may change the beneficiary of a policy for any reason. The insured, however, may not change the rights of the beneficiary if the rights become vested.

The prior beneficiaries of a policy may also challenge the validity of the acquisition of rights under the policy. Such a challenge may question the legal competency of the insured to enter into the transaction.

In an effort to address these risks, Neuma, Inc. requires a statement of mental competence signed by the applicant’s physician, spouse, or other person who knows the applicant. Neuma may also require the applicant to provide a statement from his or her financial advisor indicating that the insured has been fully advised as to the terms of the transaction.