Beneficiary: What Does It Mean?

A beneficiary is the person (or organization) designated to receive benefits from your insurance policy. This term is most commonly used with life insurance, but it also applies to other policies like disability insurance or retirement accounts.

You can typically name primary beneficiaries (first in line) and contingent beneficiaries (backup recipients). Keeping your beneficiary information current is crucial—life changes like marriage, divorce, births, or deaths should prompt you to review and update these designations. Without proper beneficiaries named, your benefits might end up in probate court instead of quickly reaching the people you intended to help.