Leigh Insurance Agency of St Augustine Blog
Designating both main and dependent beneficiaries is one of the finest strategies to ensure that your assets are managed according to your preferences. However, if you're still undecided who to choose because you're unsure what is the difference between the two, here's what you need to know.
What is a Primary Beneficiary?
As the term implies, primary beneficiaries get the first right to seek benefits. In fact, you have the option of naming many primary beneficiaries and deciding how the benefits will be distributed among them.
For example, if you have three children, you may name them as primary beneficiaries on your life insurance. As a result, if you die, all three of your children will get the benefits based on the proportions you select.
What is a Contingent Beneficiary?
When you choose a contingent beneficiary, you are effectively designating this individual as a fallback option in case anything with your primary beneficiary somehow doesn't work well. So, this beneficiary will become the beneficiary of your assets if your first pick becomes unable to perform the position.
Who Can I Choose As My Beneficiaries?
You can name almost anybody as a main or contingent beneficiary of your possessions, with one significant exception: the recipient must have attained the legal age considered in your state to receive your assets directly.
Additionally, regardless of how much you cherish your pet, they cannot be designated as a beneficiary for your life insurance. However, if you are worried about your pet's well-being after your death, you can provide for them in your will or living trust.
Aside from that, your beneficiary does not have to be a specific person. You might also find your desired charity or nonprofit organization as your primary or contingent beneficiary. However, this choice has extra tax ramifications.
You might be planning for "what if" scenarios by naming your primary and contingent beneficiaries. As a result, you are doing all possible to guarantee that your assets are distributed to the persons or entities you wish.
At Leigh Insurance Agency, we aim to provide comprehensive insurance policies that make your life easier. We want to help you get the insurance that fits your needs. You can get more information about our products and services by calling our agency at (904) 826-0799. Get your free quote today by CLICKING HERE. The coverage discussed is not guaranteed. Please contact our agents to make sure you have adequate coverage and your needs are being met. We are happy to help!