Glossary · People and paperwork
In short
Naming who receives the proceeds from an asset, like a life insurance policy, upon the owner's death. For an SBA loan, the lender will likely be designated as the beneficiary or assignee of your required life insurance.
When a lender requires life insurance on a key principal for an SBA 7(a) loan, you'll need to formally designate the lender as the primary beneficiary or assign the policy to them. This ensures the loan is repaid if the guarantor dies, protecting the lender and potentially other guarantors.
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Defined by DealRoom.so SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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