Which designation ensures a deceased beneficiary's share passes to that beneficiary's descendants?

Which designation ensures a deceased beneficiary's share passes to that beneficiary's descendants?

• A. Per stirpes designation
• B. Irrevocable designation
• C. Common disaster clause
• D. Trusts

Answer: (A)

Per stirpes designations ensure a deceased beneficiary’s portion is passed to that beneficiary’s descendants, maintaining the family line. The idea is “by branch”: if the named beneficiary dies before the insured, that share goes to the deceased beneficiary’s children, or to their issue if a child is also deceased, in equal parts among those descendants. This keeps the proceeds moving down the family line rather than redistributing it among surviving beneficiaries in a different way. For example, if the insured names a beneficiary who has two children and that beneficiary dies first, those two children would split that beneficiary’s allotted share. If there are no descendants, the share follows the policy’s other terms. The other concepts address different issues—irrevocable designations relate to changing beneficiary rights, a common disaster clause covers scenarios where death occurs in a common event, and trusts are separate vehicles for managing assets.

Per stirpes designations ensure a deceased beneficiary’s portion is passed to that beneficiary’s descendants, maintaining the family line. The idea is “by branch”: if the named beneficiary dies before the insured, that share goes to the deceased beneficiary’s children, or to their issue if a child is also deceased, in equal parts among those descendants. This keeps the proceeds moving down the family line rather than redistributing it among surviving beneficiaries in a different way. For example, if the insured names a beneficiary who has two children and that beneficiary dies first, those two children would split that beneficiary’s allotted share. If there are no descendants, the share follows the policy’s other terms. The other concepts address different issues—irrevocable designations relate to changing beneficiary rights, a common disaster clause covers scenarios where death occurs in a common event, and trusts are separate vehicles for managing assets.