Can you put life insurance on friend?

In order to own and pay for life insurance a person must have what is known as an "insurable interest" (financial relationship). Courts have held that an ex-spouse receiving child support and alimony is an insurable interest. I can't buy insurance on you because your death would have no financial impact on me. If you were business partners, I could. If I was going to raise your son if you died, I could buy a policy on you.

These policies are expensive; and some states may not allow them. Lloyd's of London is one such insurance carrier. Petersen's International is one such coverholder in Valencia, CA.