Health · Chapter 18 · Beneficiaries
Tertiary Beneficiary & Succession
Definition
The third in line for policy death proceeds, paid only if the insured outlives both the primary (first, receives proceeds income tax-free) and secondary/contingent (paid only if the primary predeceases the insured) beneficiaries. Naming beneficiaries lets proceeds bypass probate; with no beneficiary, benefits fall into the insured's estate. An irrevocable beneficiary has a vested interest: no assignment, loans, or surrender without consent — and a right to a copy of the policy.
Exam tip
Simultaneous death (USDA): the insured is presumed to have died LAST → proceeds go to the contingent beneficiary. The common disaster provision adds a survivorship period (typically 14–30 days) the primary must outlive.
Easy to confuse with
These are what this term gets tested against — if you can't tell them apart cold, drill the contrast.
Related terms