What Is a Beneficiary for Your Group Benefits Life Insurance?
Understanding Your Coverage
What Is A Beneficiary?
If you’re covered by group life insurance through your employer, you’ll be asked to name a beneficiary—but what does that mean, and why is it so important?
A beneficiary is the person (or people) you choose to receive your life insurance benefit if you pass away while insured under your group plan.
This benefit is typically a tax-free lump sum designed to provide financial support to your loved ones during a difficult time.
- Covers funeral costs & final expenses
- Helps with mortgage & debt payments
- Supports ongoing living expenses
- Paid directly — outside of your estate
Beneficiary Types
Who Can You Name?
You have full control over who receives your benefit. Most plans allow you to name both a primary and a contingent beneficiary to make sure your wishes are always covered.
Primary Beneficiary
The first in line to receive the benefit. You can name one person or split the benefit between several people with defined percentages that add up to 100%.
Contingent Beneficiary
A backup, in case your primary beneficiary passes away before you. Without one named, the benefit falls to your estate—causing delays and additional costs for your family.
Who Qualifies?
Beneficiaries can be individuals (such as a spouse, children, or a close friend), multiple people with split percentages, or even an organization like a charity or trust.
PROTECT YOUR LOVED ONES
What Happens If You Don't Name a Beneficiary?
If you don’t name a beneficiary, your life insurance proceeds will be paid to your estate—not directly to your family.
Here’s what that means in practice:
Delays & Probate
The funds must go through probate—the legal process of settling your estate. This can take weeks or months, delaying access to money when your family needs it most.
Legal Fees & Creditor Claims
The full amount may be reduced by legal and administrative fees. Depending on your province and estate structure, creditors may also have claims on the funds.
Loss of Control
Without a beneficiary named, funds are distributed based on your will—or, if there's no will, by provincial estate laws. There's no guarantee money goes where you intended.
In short:
Naming a beneficiary ensures your loved ones receive the full benefit, faster and with fewer complications.
Where to Find Your Coverage Details
To review your life insurance coverage—including your benefit amount, eligibility, and how to name or update a beneficiary—follow these steps:
Log In to Your Portal
Sign in to the employee portal provided by your employer or plan administrator.
Open Your Benefits Booklet
Your group benefits booklet outlines all key features of your plan, including life insurance coverage amounts and eligibility.
Review or Update
If you would like to update your beneficiary, please contact your plan administrator to make the necessary changes.
Questions?
If you're unsure whether you've named a beneficiary, or need help making updates to your plan, don't hesitate to reach out. We'll walk you through everything in plain language—no insurance jargon required.