A. The death proceeds of a life insurance policy are includable in the following three situations:
- The proceeds are payable to the insured’s estate, or are receivable for the benefit of the insured’s estate;
- The proceeds are payable to a beneficiary other than the insured’s estate but the insured possessed one or more incidents of ownership in the policy at the time of the insured’s death, whether exercisable by the insured alone or only in conjunction with another person;
- The insured has made a gift of the policy on the insured’s life within three years of his or her death