Alternate Beneficiary

DEFINITION of 'Alternate Beneficiary'

In a will, an alternate beneficiary is usually named in case a person who is the named beneficiary refuses or disclaims the inheritance. In an insurance policy, an alternate beneficiary is usually a secondary or contingent beneficiary who receives the proceeds if the primary beneficiary has died.

BREAKING DOWN 'Alternate Beneficiary'

Alternate beneficiaries are more common with real or personal property. For example, if a testator left a favorite painting to a niece who did not want it, the testator could name a second or third person to whom the painting would go.

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RELATED FAQS
  1. Do beneficiaries pay taxes on life insurance?

  2. What does U.S. law say about contingent beneficiaries?

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  4. Under what circumstances will a contingent beneficiary receive an insurance payout?

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  5. If both the primary and contingent beneficiaries are unavailable, what happens to ...

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  6. What are the pros/cons of naming a trust as the beneficiary of a retirement account?

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