Which of the following best describes a contingent beneficiary?

A contingent beneficiary is specifically designated to receive the policy benefits in the event that the primary beneficiary is unable to do so, typically due to their death. This arrangement ensures that the benefits are distributed according to the policyholder's wishes in various scenarios, providing a solution in case the primary beneficiary predeceases the insured or is otherwise unable to claim the benefits.

The role of a contingent beneficiary is crucial in estate planning and insurance policy management, as it helps to avoid legal complications and ensures that the policyholder's intentions are honored even if the initial beneficiary cannot fulfill that role.

In contrast to other options, the contingent beneficiary is not the primary recipient of benefits; instead, they serve as a backup. This differentiates them from the first entitled claimant and highlights the importance of having a plan in place for various outcomes related to the primary beneficiary’s status. Additionally, while contingent beneficiaries can be changed, it is not accurate to say they cannot be changed at all; the policyowner usually has the flexibility to update their designations as needed.