When third-party ownership is involved, applicants who are the stated primary beneficiary are required to have:

The correct choice highlights the requirement of having an insurable interest in the proposed insured when third-party ownership is involved. Insurable interest is a legal and ethical concept in insurance that ensures that the person who purchases the policy has a genuine interest in the continued life and well-being of the individual being insured. This is crucial because it helps to prevent situations where someone might take out an insurance policy on another person without any legitimate connection, which could encourage insurance fraud.

For example, a parent has an insurable interest in the life of their child, as their well-being and financial stability may depend on the child's life. Similarly, a business partner may have an insurable interest in the life of their co-partner, as the loss of one partner could significantly impact the operation and profitability of the business.

The other choices may seem relevant but do not fulfill the legal requirements as comprehensively as the notion of insurable interest. Consent from the insurer, approval from the proposed insured, and financial dependency are not sufficient on their own, as they do not necessarily establish the ethical grounding for taking out a policy on another individual. Thus, establishing insurable interest is fundamental in ensuring the integrity of the insurance process, particularly in scenarios involving third-party ownership.