(AML-CFT Decision Article 11)

For life or other investment-related insurance business, FIs should, in addition to the CDD measures required for the customer and the beneficial owner, conduct the following CDD measures on the beneficiary(ies) of life insurance and other investment related insurance policies, as soon as the beneficiary(ies) are identified/designated:

(a) For beneficiary(ies) that are identified as specifically named natural or legal persons or legal arrangements – taking the name of the person;

(b) For beneficiary(ies) that are designated by characteristics or by class (e.g. spouse or children at the time that the insured event occurs) or by other means (e.g. under a will) – obtaining sufficient information concerning the beneficiary to satisfy the financial institution that it will be able to establish the identity of the beneficiary at the time of the payout. The information collected under (a) and/or (b) should be recorded and maintained.

For both the cases referred to above, the verification of the identity of the beneficiary(ies) should occur at the time of the payout.

In determining whether enhanced CDD measures are applicable, an FI should take into account as a factor the beneficiary of a life insurance policy. If an FI determines that a beneficiary who is a legal person or a Legal Arrangement presents a higher risk, then the enhanced CDD measures should include reasonable measures to identify and verify the identity of the beneficial owner of the beneficiary, at the time of payout.

In case an FI cannot comply with this, the FI should consider filing an STR with the FIU.