Which of the following best describes life insurance policies that allow beneficiary ownership rights during the insured's lifetime?

Participating life insurance policies are designed to offer policyholders not just coverage but also a share in the insurer's surplus earnings. This means that during the insured's lifetime, beneficiaries may hold certain ownership rights, which can include the ability to receive dividends or participate in decisions related to the policy. These dividends can be used in various ways, such as to reduce premiums, purchase additional coverage, or accumulate cash value.

The key aspect of participating policies is the ability to benefit from the financial success of the insurer, which directly relates to the provision of ownership rights. Therefore, beneficiaries are not only named individuals who would receive proceeds upon the insured's death but may also enjoy financial benefits while the insured is still alive. This contrasts with other types of policies, where ownership and potential benefits may be limited or structured differently.

Understanding the nature of participating life insurance is vital for recognizing how these policies operate and the rights they confer to beneficiaries, enhancing engagement with the product through potential financial participation.