Who is the beneficiary on a VMLI policy?

The correct answer identifies the mortgage holder on the veteran’s specially adapted house as the beneficiary of a Veteran's Mortgage Life Insurance (VMLI) policy. VMLI is designed to pay off the mortgage on a specially adapted home if the veteran who owns the policy dies. This ensures that the mortgage is settled, allowing the beneficiary—typically the lender or mortgage holder—to alleviate any financial burden from the veteran's family.

In the context of VMLI, the policy is specifically tailored to protect the financial interests of those involved in the mortgage agreement. As such, this arrangement does not automatically confer benefits to individuals like the spouse or co-mortgagees outside the arrangement with the lender, since the primary purpose is to safeguard the financial obligation tied to the property rather than providing direct benefits to individuals unrelated to the mortgage.

The choice indicating the veteran's spouse as a beneficiary would not hold, as VMLI directly addresses the mortgage itself rather than personal beneficiaries. Similarly, co-mortgagees other than the veteran's spouse would also not be designated beneficiaries under VMLI, as the primary focus remains on the lender's financial interest tied to the insured mortgage. Lastly, suggesting that none of the choices are correct fails to recognize the primary function of