What is the definition of Contingent Beneficiary?

The Contingent Beneficiary is the person or legal entity that stands to get the proceeds of a life insurance policy (particularly the death benefits) if the primary beneficiaries die before the insured person or are unwilling or unable to receive the benefits.

The contingent beneficiary helps to ensure that a loved one is provided for in the event of the death of an individual. For example, a parent may name his spouse as his primary beneficiary and his children as his contingent beneficiaries. Then, in the event when they die at the same time, or when the spouse dies before the insured, the children will receive the death benefit.

This is also called a secondary beneficiary. There may be more than one contingent beneficiary. In some insurance companies, you may even be allowed to set the order of succession or the percentage of the benefit that will be received by each contingent beneficiary.

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