The owner of the policy agrees to pay premiums to the insurer on a regular basis for a specified period of time, while the insurance company agrees to pay a death benefit out on the policy upon the death of the insured person, subject to the terms, conditions and exclusions stated in the insurance policy.
The death benefit would be paid to the beneficiary of the policy. The owner of the policy selects the beneficiary or beneficiaries of the insurance policy.
Learn more about how life insurance coverage works.