What is a Contingent Beneficiary?

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  • Written By: Malcolm Tatum
  • Edited By: Bronwyn Harris
  • Last Modified Date: 01 December 2018
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Contingent beneficiaries are individuals, trusts, or estates that are designated to receive the assets of a deceased person in the event that the primary beneficiary is no longer able to assume those assets for some reason. Attorneys commonly recommend that wills contain a reference to at least one contingent beneficiary as a means of preparing a backup plan for the disposition of the property and other holdings of the deceased if necessary. It is permissible to name more than one and even to assign a specific order of succession to the additional listed persons or entities.

The concept is also often employed with insurance policies as well. For example, a life insurance policy may name a spouse or partner as the beneficiary upon the death of the insured party. At the same time, the terms of the policy may make it possible for the insurance company to award the proceeds to children, or other relatives and friends of the deceased, if those people are named as contingent beneficiaries. This action would only take place if the main beneficiary was also deceased or otherwise declared to be ineligible to receive the proceeds from the policy.


Naming at least one contingent beneficiary in all insurance policies, as well as in a will, is one way of ensuring that loved ones or a cause that is close to the heart is provided for once the death of an individual takes place. The structure can be very simple, with no qualifications to be met, other than being in a position to take control of the assets, but the provisions for delivery can also be more comprehensive if desired.

For example, a will may state that all assets go to the spouse as the main beneficiary. In the event that the spouse is alive but determined to be unable to handle the estate, a child may be named as the back-up, with the proviso that the child uses the assets of the estate to care for the spouse until his or her death. Once the main beneficiary passes away, the terms of the will could direct that the remainder of the estate be granted directly to the child.

Many people choose to make use of this option with both insurance policies and wills. The end result is that the disposition of assets is not complicated due to unforeseen events, such as the death of the main beneficiary. By creating a backup plan for the disbursement of property and other holdings, it is possible to be sure that the estate is put to good use after death.


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Post 4

will a court supervise how i spend my trust share if another inherits it upon death? the reason being to ensure i do not spend it too soon or spend it all?

Post 2

What if the primary beneficiary is a child and the contingent beneficiary is the adult? what happens if the policy holder dies?

Post 1

Scope of what constitutes a contingent beneficiary may be variable given a trust's purpose to provide for health, education and welfare of a recipient.

If a parent is a beneficiary, for example, does it not also include the child/children of that parent if expenses are paid to insure health, education, and welfare of the parent where his children are concerned? How about his spouse?

Can any trust be totally confined to one person if the wide scope of health, education and welfare is the standard of measure of that family member, and implicitly includes health, education and welfare of his family as conclusory interests of his?

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