Definition of "Contingent Beneficiary"

An additional or alternate beneficiary to the primary beneficiary.

This is the person designated to receive the death benefit of a life insurance policy if the primary beneficiary dies before the life insured. This is a consideration when husband and wife make each other the beneficiary of their coverage. Should they both die in the same car accident or plane crash, the death benefits would go to each others estate and creditor claims could be made against them. Particularly if minor children could be survivors, then a trustee contingent beneficiary should be named.

The party designated to receive certificate proceeds if all principal beneficiaries should die before the person whose life is insured. See principal beneficiary.