Definition of beneficiary

individual who will receive an inheritance upon the death of another. The proceeds of an insurance policy may be in the form of a lump-sum or annuity.

1. person named to receive income from a trust, insurance policy, or endowment.
2. in trade finance, the person or company in whose favor a letter of credit (L/C)is opened or a draftis drawn.
3. the last-named party receiving payment in a transaction. Also calledultimate beneficiary,
4. person to whom an estate passes, as provided by a will

the person who receives or is to receive the benefits resulting from certain acts. In a tax context, a person entitled to the benefits from trust property or from an insurance policy.

1. person to whom an inheritance passes as the result of being named in a will.
2. recipient of the proceeds of a life insurance policy.
3. party in whose favor a Letter of Credit is issued.
4. one to whom the amount of an annuity is payable.
5. party for whose benefit a trust exists.

designation by the owner of a life insurance policy indicating to whom the proceeds are to be paid upon the insured's death or when an endowment matures. Anyone can be named a beneficiary (relative, non-relative, pet, charity, corporation, trustee, partnership). A primary beneficiary is the first-named beneficiary, who must survive the death of the insured in order to collect the proceeds. A contingent or secondary beneficiary will receive the proceeds if the primary beneficiary does not survive the insured. A revocable beneficiary (primary or secondary) can be changed by the policyowner at any time. An irrevocable beneficiary(primary or secondary) can be changed by the policyowner only with the written permission of that beneficiary. Naming an irrevocable beneficiary removes the policy from the estate of the insured, who thereby gives up incidences of ownership for estate tax purposes.

If a beneficiary is convicted of murdering the insured, the beneficiary cannot collect the death benefit. The insured's estate would receive the benefit.

the person who receives or is to receive the benefits resulting from certain acts.

Example: Whitman takes out a $100,000 life insurance policy with her husband as the beneficiary. Should Whitman die, her husband will receive the benefits from the policy.