What it Takes to Qualify as a Beneficiary

What it Takes to Qualify as a Beneficiary

A beneficiary is the person designated to receive the proceeds of a life insurance policy in the event of the death of the insured. The beneficiary is named in the policy itself. What does it take to qualify as a beneficiary and what should you know about naming a person as your beneficiary?

To qualify as a beneficiary, a person needs to have an insurable interest in the insured. This means that there must be some sort of relationship between the beneficiary and the insured, and that the beneficiary would suffer some form of loss in the event of the death of the insured. In many cases this is a spouse or other close relative but it could also be a business partner or even a business itself.

While a minor can be the beneficiary of a life insurance policy, they may not have access to the actual proceeds until attaining legal age. If the intent is to have proceeds benefit a minor, it is better to have a trusted friend or relative of legal age be beneficiary to administer the funds if your wishes are to establish a trust in the name of the minor.

Many married couples will name each other as beneficiaries, which may be understandable, but could cause problems if both were to die in the same accident. This is where a contingent beneficiary can be useful. A contingent beneficiary is secondary to the main beneficiary, and would receive the proceeds only if the main beneficiary is not alive or otherwise incapacitated. Naming a contingent beneficiary is a good way to help ensure proceeds will not go into the estate.

One of the challenges with beneficiaries is making sure they are up to date. Life happens and major changes to our lives may occur to warrant a beneficiary change. These changes my include a marriage, divorce or death in the family. Like all of your insurance policies, life insurance coverage should be reviewed occasionally for accuracy and to determine if coverage is still sufficient.

If you would like to have a life insurance policy review, get a quote on life insurance, or perhaps have an entire insurance protection overhaul, we invite you to contact us. As independent insurance agents, we are qualified to review the policies from any company for just about any type of insurance.

How will you know if you are paying too much unless you compare? We would be glad to assist you.


Do you have questions about your insurance? Find an insurance agent near you with our Agent Finder

Buzz Your
Insurance Agent

Search for a local agent with our agent finder map.

Agent Finder

Search All Blogs

Generic filters
Exact matches only
Search in title
Search in content
Search in excerpt

Buzz Your
Insurance Agent

Search for a local agent with our agent finder map.

Agent Finder

Want to learn more about
our blog writer?

Read more about KayLynn's background.

Search All Blogs

Generic filters
Exact matches only
Search in title
Search in content
Search in excerpt

Unveiling the Different Players (and Why We’re Your Guide!)

Insurance Companies: Not All Created Equal! Find Your Perfect Match with Our Help

Cracking the Code: Cash Value, Loan Value, Surrender Value – It’s All in the Life Insurance Policy!

Beyond the Death Benefit: Unlocking the Hidden Gems of Your Life Insurance Policy

Beyond the Payout: 6 Unexpected Perks of Life Insurance You Might Not Know

More Than Just a Payout – Unlock 6 Hidden Gems for Your Loved Ones

Poppin’ Pills and Counting Coins: America’s Prescription Drug Dilemma

America’s love affair with drugs isn’t limited to back alleys and bong rips.

Ditch the Piggy Bank, Grab the Plan: Your Adulting Health Insurance Guide

Bye-Bye, Mom’s Policy! 5 Easy Steps to Your Adult Health Insurance Adventure

Life Insurance: Who’s Who in the Zoo (of Coverage)?

Feeling lost in the jungle of life insurance terms?

Don’t Fear the Four

Learn About Your Life Insurance Posse

Cracking the Code: Why Your Health Insurance Bill Isn’t One-Size-Fits-All

Health Insurance Premiums: Unraveling the Mystery of Why Everyone Pays Differently

New Year, New Resolutions: 5 Ways to Refresh Your Life Insurance

5 Life Insurance Resolutions for the New Year: Embracing Peace of Mind and Financial Security

Life Insurance: Understanding the Benefits of Term Insurance

Navigating Life Insurance: Unveiling the Value of Term Insurance