In a life insurance policy, who is a beneficiary?

A beneficiary in a life insurance policy is defined as a person or entity designated to receive the death benefit upon the insured's passing. This important role is established in the policy documents when the policyholder specifies who will receive the financial payout, ensuring that their wishes are honored after their death. It can be a family member, a friend, a charity, or any other organization that the policyholder selects.

The role of the beneficiary is crucial, as they are the ones who will benefit financially from the policy, providing support or fulfilling obligations the policyholder may have intended. Understanding this definition is vital for anyone involved in life insurance, as it clarifies the purpose and function of a beneficiary in the insurance process.