Beneficiary
Definition
A beneficiary is a person or entity designated to receive benefits from an insurance policy, trust, will, or other legal arrangement. In the insurance context, the beneficiary is the party entitled to receive policy proceeds when a claim is paid. Primary beneficiaries receive benefits first, while contingent beneficiaries receive benefits only if primary beneficiaries cannot.
How It’s Used in Personal Injury Cases
Beneficiary designations become crucial in wrongful death cases and life insurance claims. When someone dies in an accident, their life insurance beneficiaries receive the death benefit. In wrongful death lawsuits under Texas Civil Practice and Remedies Code Chapter 71, statutory beneficiaries (surviving spouse, children, parents) can bring claims for damages caused by the wrongful death. Identifying all beneficiaries ensures proper distribution of both insurance proceeds and lawsuit recoveries.
Practical Example
When Michael was killed in a trucking accident, his wife was the primary beneficiary of his $500,000 life insurance policy. Separately, as statutory beneficiaries under Texas law, his wife and two children filed a wrongful death lawsuit against the trucking company. The wrongful death settlement was allocated among all three beneficiaries according to their respective losses—the wife received compensation for loss of consortium and support, while the children received compensation for loss of parental guidance and inheritance.
Why It Matters to Your Case
If you’ve lost a loved one due to someone else’s negligence, understanding your status as a beneficiary determines your right to insurance proceeds and wrongful death recoveries. Texas law limits who can bring wrongful death claims to specific statutory beneficiaries. Proper identification of all beneficiaries ensures complete recovery and appropriate distribution of any settlement or judgment.
Key Takeaway
As a beneficiary, you’re entitled to receive insurance proceeds or wrongful death recoveries—understanding your beneficiary status is essential to protecting your legal rights after losing a loved one.