Beneficiary

A beneficiary is an individual, group of individuals, or entity designated to receive the benefits from an insurance policy or financial instrument, such as a will, trust, retirement account, or life insurance policy. In the context of life insurance, the beneficiary is the person or entity whom the policy owner names to receive the policy’s death benefit upon the death of the insured. Beneficiaries can be primary, who are first in line to receive the benefits, or contingent, who are second in line should the primary beneficiary predecease the insured or be unable to accept the benefit. Beneficiaries are often family members, but they can also be friends, trusts, charities, or organizations. The policy owner can typically change the beneficiary designation at any time unless the policy has an irrevocable beneficiary designation, which cannot be changed without the beneficiary’s consent. It is important for policy owners to keep beneficiary designations up to date to ensure that the benefits are distributed according to their current wishes.