If a policy lacks a designated beneficiary, who will receive the benefits?

In the event that a life insurance policy does not have a designated beneficiary, the benefits from the policy will generally be paid to the insured's estate. This occurs because, without a named beneficiary, the insurance proceeds are considered part of the deceased's assets. The estate will then handle the distribution of these assets according to the terms of the will or, if there is no will, according to the laws of intestate succession in the relevant jurisdiction.

This process emphasizes the importance of designating a beneficiary to ensure that the intended recipient receives the benefits directly and bypasses the potentially lengthy and complex probate process associated with transferring assets through the estate. If a policyholder wishes to avoid the estate route, it is essential to keep beneficiary designations up to date.