Primary beneficiary
Primary beneficiary has the first right to receive insurance benefits. This means they will receive insurance settlement if the insurance policy terms are met.
Primary beneficiary may claim payment of insurance amount upon the policyholder’s death or upon the occurrence of other conditions provided in the policy.
Contingent beneficiary
Contingent beneficiary is entitled to receive insurance benefits only if certain conditions set forth in the policy are met. For example, this could be the policyholder’s death or the arrival of a certain date.
For instance, if a policyholder names their spouse as a primary beneficiary and their son as a contingent beneficiary with the provision that the son will receive the insurance proceeds only if the spouse dies before the policyholder, then the spouse has priority right to receive insurance benefits. If the spouse dies first, the son becomes the primary beneficiary.
It is essential to remember that details and terms may vary depending on the specific insurance policy and local laws.
Photos are from open sources.
