Contingent Beneficiary

For life insurance, and other similar things, the contingent beneficiary represents a kind of backup. Like a second-string quarterback or relief pitcher.

You have your spouse listed as the beneficiary on your life insurance. But then both of you meet your demise simultaneously in a freak dishwasher explosion. What happens to your life insurance benefits?

Luckily, you specificed your children as your contingent beneficiaries. Since your primary beneficiary isn't available (due to the wet boom that took place in your kitchen), the insurance company moves to the contingent beneficiaries.

We've used life insurance as the example. But it can come up in any situation that includes a beneficiary. Pensions and other retirement accounts are common as well.