DBO full form

What does DBO mean or stand for ?

The DBO is a claim option in a Life Insurance policy.It states that the beneficiary who is supposed to receive the payout when the policy holder dies will benefit from this option.That is the whole idea behind life insurance.It means you are insuring your life.

For example if John buys an insurance policy worth $500,000 and opts for the DBO option and nominates his wife Ellie to be the beneficiary to the claim,upon his death Ellie will receive $500,000.

However there maybe a yearly premium to be paid until John’s death.