Beneficiary

What Does Beneficiary Mean?

A beneficiary, in the context of insurance, is any person or legal entity entitled to the benefits, proceeds, and/or earnings of a life or health insurance policy. They are typically named or described with reasonable certainty in the insurance contract. Beneficiaries can be classified into primary beneficiaries, who are the first in line to receive benefits, and secondary or contingent beneficiaries, who will receive benefits if the primary beneficiary is unavailable.

Insuranceopedia Explains Beneficiary

A beneficiary would receive the proceeds of a life insurance policy in the event of the insured person’s death. In health insurance, the beneficiary is entitled to receive covered healthcare services.

A primary beneficiary is the first party legally entitled to the benefits of the insurance policy. If the primary beneficiary passes away before the insured, a contingent beneficiary—if named or described in the contract—becomes legally entitled to receive those benefits.