So we hear this word a number of times while performing any transaction with the bank, or buying an insurance policy, or even when the laws are preached out aloud. The question stands in front of us, what is a beneficiary? A number or people surprisingly are unfamiliar with the term. Why is this so?

Well to start off first, it’s because we are reluctant to read out the terms and condition contracts and agreements. It is important for one to have to know how about these terminologies which quiet repetitively is used in bank contracts and insurance policies.

However, over here we would like to stick to insurance and what does a beneficiary have reference in this context? A beneficiary is one who receives the benefits of the insurance policy he/she has applied for. This is the primary person who has applied for the insurance and is the owner of the insurance. He is applicable to benefit off the specific insurance he has applied. For instance if Jim has applied for health insurance than the contract states that he will enjoy the benefits provided by the health insurance to him. This is applicable on all insurances.