What Does Tertiary Beneficiary Mean?

By Karyn Maier

The term “tertiary” is from the Latin word “tertiarius,” which translates to “of a third.” The word is used to refer to a third order, level, stage, rank or designation, as in “tertiary education," which follows primary and secondary levels of education. In the insurance industry, a tertiary beneficiary is a person or entity entitled to receive benefits in the event the first and second beneficiaries cannot.

Beneficiary Defined

A beneficiary is a person or entity designated to receive assets upon another person's death. Specific beneficiaries are named in a last will and testament or in a life insurance policy; they typically include a person’s spouse, children or other relatives. Some people designate charities, trusts or other legal entities as beneficiaries instead of family members, either by choice or because none exist. A person may even choose to leave everything to benefit the care of a beloved pet. However, some types of financial accounts and insurance policies may automatically elect a surviving next of kin as the default beneficiary if no other beneficiaries were designated when the account was created.

Tertiary Beneficiary

As the name suggests, a tertiary beneficiary is third in line in terms of the distribution of assets or the payout of life insurance benefits. However, being named as a tertiary beneficiary doesn’t mean that you can expect to receive one-third of the contents of an estate or insurance policy benefits after the first and secondary beneficiaries get their shares. Instead, it means that you will only receive property or a payout by default if the first and second beneficiaries have died or are no longer eligible or qualified as beneficiaries. For example, if you named your spouse as primary beneficiary and then get a divorce, your spouse automatically loses her designation as your primary beneficiary.

Divorce is never easy, but we can help. Learn More

Tertiary Order

To illustrate how a tertiary beneficiary fits into a benefits payout, assume that your last will and testament or an insurance policy designates your spouse, child and grandchild as primary, secondary and tertiary beneficiaries, in that order. If, at the time of your death, your spouse is living, then he or she will receive 100 percent of the assets or benefits. If your spouse predeceases you, then your child will receive 100 percent. If your grandchild is the only surviving beneficiary at the time of your death, then he or she will receive the entire amount. However, if all three are living at the time of your death, only the primary beneficiary, your spouse in this scenario, will receive any benefits.


It’s a good idea to review your last will and testament and insurance policies periodically and update them accordingly. This is particularly important if your circumstances change, such as the death of a spouse or a divorce. Consult your attorney, insurance agent or financial advisor for guidance.

Divorce is never easy, but we can help. Learn More
What Is a Surviving Primary Beneficiary?


Related articles

What If an Heir Dies?

The impact of an heir’s death on the probate process depends a great deal on whether he is also a beneficiary. An heir is a relative entitled to inherit from the decedent by law -- heirs inherit when the decedent dies without a will. Beneficiaries are those individuals named in a decedent’s will to receive his property. They may or may not be related to him. An individual can be both an heir and a beneficiary when he's bequeathed property in a will and is also related to the decedent, so he would have stood to inherit even if the decedent had not left a will.

No Beneficiary Life Insurance Laws in Ohio

There’s no law that says you must name a beneficiary on your life insurance policy, but if you don’t, state law can get involved with what happens next. It’s also possible to name a beneficiary who isn't able to accept the benefits when the time comes. Ohio law determines at least one instance when this might occur automatically.

Can a Charitable Remainder Trust Be Set Up by a Will?

A charitable remainder trust is designed to allow you and your beneficiaries to benefit from your assets during your lifetime but give the assets to charity when you die. The creator, or "settlor," of the charitable remainder trust can set the trust up using a will; these trusts are known as testamentary charitable remainder trusts. But will and trust law is state-specific, so the creation and operation of both the trust and will must follow your particular state's laws.

Get Divorced Online

Related articles

Rights of Primary Beneficiary Vs. Contingent Beneficiary

You can’t take your assets with you when you die, but you can create an estate plan to leave them to your loved ones ...

Difference Between the Primary & the Successor on a Change of Beneficiary

Individuals name primary and successor beneficiaries on specific money holdings, including life insurance benefits, ...

How to Name a Trust as Successor Beneficiary of an Inherited IRA

When someone creates an Individual Retirement Account, she names a beneficiary to inherit whatever remains in the ...

Common Disaster Provisions in Wills

In the parlance of wills and insurance policies, a common disaster provision is language which directs how assets or ...

Browse by category
Ready to Begin? GET STARTED