We use cookies to improve security, personalize the user experience,
enhance our marketing activities (including cooperating with our marketing partners) and for other
business use.
Click "here" to read our Cookie Policy.
By clicking "Accept" you agree to the use of cookies. Read less
What is a Secondary Beneficiary? A Comprehensive Legal Guide
Definition & Meaning
A secondary beneficiary is a person or entity designated to receive assets from a will, trust, or insurance policy if the primary beneficiary passes away before the grantor. Essentially, they are the backup choice for receiving a bequest. This term is often used interchangeably with "contingent beneficiary." In situations where all primary beneficiaries have died, the secondary beneficiaries will inherit the assets as if they were primary beneficiaries.
Table of content
Legal Use & context
The term "secondary beneficiary" is commonly used in estate planning, insurance, and trust law. It plays a crucial role in ensuring that assets are distributed according to the grantor's wishes, even if the primary beneficiaries are unable to inherit. Users can manage this aspect of their estate planning with legal templates available through US Legal Forms, which can help create wills, trusts, and insurance documents that clearly outline beneficiary designations.
Key legal elements
Real-world examples
Here are a couple of examples of abatement:
Example 1: If a person names their spouse as the primary beneficiary of a life insurance policy and their adult child as the secondary beneficiary, the child will receive the policy's benefits if the spouse dies before the insured.
Example 2: In a trust, if the primary beneficiary is a sibling who passes away before the trust's creator, the assets will go to the secondary beneficiary, such as a cousin. (hypothetical example)
State-by-state differences
Examples of state differences (not exhaustive):
State
Notes
Nebraska
Defines secondary beneficiaries as those entitled to receive benefits if all primary beneficiaries die before the member.
California
Allows for multiple secondary beneficiaries to be named, with equal rights to inherit.
This is not a complete list. State laws vary, and users should consult local rules for specific guidance.
Comparison with related terms
Term
Definition
Primary Beneficiary
The first person or entity entitled to receive assets from a will, trust, or insurance policy.
Contingent Beneficiary
Another term for secondary beneficiary, receiving assets only if primary beneficiaries are deceased.
Common misunderstandings
What to do if this term applies to you
If you are considering designating a secondary beneficiary, review your current estate planning documents to ensure they reflect your wishes. You can use US Legal Forms to find templates for wills and trusts that allow you to specify beneficiaries clearly. If your situation is complex, it may be wise to consult with a legal professional for tailored advice.
Find the legal form that fits your case
Browse our library of 85,000+ state-specific legal templates.