Beneficiary Designations: Per Capita v Per Stirpes


Many beneficiary designation forms for life insurance policies, annuities and retirement plans require multiple beneficiaries (typically children) to be listed by name. By default, such a beneficiary designation usually is treated as "per capita" (i.e., if a beneficiary is deceased, the benefit goes to the surviving named beneficiaries). This result generally is contrary to that provided in the decedent's will or trust, which usually distributes "per stirpes" (i.e., a deceased beneficiary's share passes to his or her descendants). If per stirpes is the intent, then the beneficiary form must be completed in such a manner as to clearly reflect this, perhaps simply by adding "per stirpes" after each beneficiary's name.

Failure to address this issue may cause these assets to pass very differently from what was intended. Depending upon the form, a designation generally can be so worded as to accomplish the desired result. Should you have any questions regarding the completion of beneficiary designation forms, please contact Eastman & Smith.