kcal, life policy proceeds will form part of an estate unless it is part of a trust. Sorry to be a pedant, but life assurance will always be for the benefit of someone else for the simple reason that you’ll be dead! 🙂
IHN re the mortgage issue. The life policy may be assigned to the lender or it can simply be set up to provide funds for the survivor to settle the loan.
We may have missed the point here anyway. Just re-read the OP. James, you can insure someone else’s life if you have an insurable interest in it i.e. if you will suffer a demonstrable financial loss on their death…business partner, co mortgagee etc. If you take out the policy on their life, the policy and proceeds belong to you and will not form part of their estate.