Chelsey Tucker graduated with a Bachelor of History degree from Metropolitan State University in 2019. She now writes about insurance with her specialty being life insurance and has been quoted on Help Smart Phone and MEL Magazine.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years. He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Mar 19, 2020

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Life Insurance Policy

If the beneficiary of a life insurance policy dies before the policyholder does, then the person paying on the insurance policy has the right to review the policy and change the beneficiary information.

Policyholders are frequently reminded to keep beneficiary information updated, as the failure to keep on top of this matter could indeed bring a tragic financial loss.

If the beneficiary has not been updated and the policy holder dies, then the situation is different.

Check out the below to learn about all of the various scenarios that could play out when a life insurance beneficiary dies and then be sure to enter your zip above for a free insurance quote comparison!

The Second Beneficiary

In most cases, policyholders are wise enough to consider all scenarios, and thus will choose a second beneficiary (or perhaps add one) just in case of unexpected death of the first beneficiary. If this happens, the life insurance secondary beneficiary only receives benefits if the first beneficiary dies. This is a smart move, as otherwise, if the policyholder dies too, the policy may wind up being held up in probate court.

What if a very tragic scenario occurs and both the policyholder and the beneficiary die at the same time? Does the insurance company get that money? Can another relative make a claim on the inheritance? It really depends on which state you live in. Some states have very specific laws regarding the line of descendants that may be able to collect benefits in the event of both beneficiary and policyholder being deceased.

If there is no particular state law protecting your family’s rights, what usually happens is that the money becomes part of the policyholder’s estate. Unfortunately, this often leads to delays in payments, increased legal costs, and possibly complex probate interactions. The process to deliver money to living relatives can be a complicated one.

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The Last Will and Testament

When the beneficiary and the policyholder die, family members (or legal representatives) have the responsibility of contacting the Social Security Department and the insurance company. Another factor that will determine the process length will be the gap of time in between the policyholder’s death and the beneficiary’s death.

You also have to consider details like “survivorship period”, which is a contractual obligation that states that the beneficiary must continue living within a certain amount of days. If this period is not specified, the insurance company may create a mandatory waiting period on their own.

If the benefits are deposited into the estate, then it will be distributed according to any will instructions that were left behind by the policyholder. If there is no will or trust, then the money could be tied up in court for a while. Typically, property and money will go to the closest living relatives. Precedent is also a factor; for example, if a property was divided up and given to a group of relatives, then the money might be divided amongst the named takers in like manner.

What happens if the beneficiary survives the policyholder’s death but then dies while the estate is still being probated?
At this point, the policyholder’s estate becomes a part of the beneficiary’s estate. The will or trust shall be examined and the benefits distributed accordingly. If the person did not have a recognized will or trust, then the money is passed along according to laws of the state.

The Importance of Planning Ahead

In order to protect your closest family members, make an effort to list a primary and secondary beneficiary. You never know what might happen in the future. The easiest way to prevent legal problems and emotional conflict with surviving family members is to list a secondary beneficiary. Some policies may even let you add more beneficiaries to be considered if the second listed name dies. If any beneficiary of your policy dies, contact the insurance company to update your named beneficiaries.

If you are shopping for a life insurance policy that can take care of your loved ones, then know that research is paramount. Talk your policy over with a qualified agent and verify all inclusions and exclusions on a contract before signing anything.

If you need coverage you can get quotes from a number of providers using the free life insurance quote tool provided on this page. Just enter your zip code to start!