The Facts

• Life insurance policies issued by the DOD to enlisted servicemembers work in much the same way as ordinary independent life insurance obtained by civilians. The rules and processes that an ordinary person would follow to declare or change a beneficiary on a life insurance policy are the same as those used by a servicemember. The function, purpose and administrative management of a life insurance policy issued by the DOD is no different from one issued by an independent life insurance carrier to a civilian.
  
  

Function

• A life insurance policy beneficiary is the person or entity who has been chosen by the policy owner to receive the proceeds of the contract if the insured person dies while coverage is still in force. DOD-issued life insurance policies will allow a spouse, child, parent, other family member, charitable organization or church to be listed as a beneficiary. The choice of beneficiaries is entirely at the discretion of the insured person and can be changed, amended or altered at any time for any reason.
  
  

Types

• There are two categories of beneficiary for DOD life insurance policies---primary and contingent. A primary beneficiary is the insured person's first choice for receipt of the policy proceeds. In the event that the primary beneficiary is not willing or able to receive the life insurance proceeds, then payment of the benefit reverts to the contingent, or secondary, beneficiary. A life insurance policy can have multiple primary and contingent beneficiaries, and differing percentages intended for each individual named as a beneficiary.
  
  

Identification

• To register a person or entity as a beneficiary on DOD life insurance policies, information is required to completely and accurately identify that person or entity. Contact information such as address and telephone number are always required, and in the case of a person their date of birth and Social Security number is necessary. If a charity, church or other organization is to be named as a beneficiary, the federal tax identification number and the name of the organization's leader will be required on the beneficiary designation forms.
  
  

Considerations

• Choosing a beneficiary for DOD life insurance is an important decision that should be made after careful consideration. Beneficiaries will receive unlimited access to their respective portions of a life insurance death benefit to be used at their discretion without restriction or oversight. The insured person should take care to choose only those individuals or organizations that will use the proceeds of a policy in a productive manner that is consistent with the owner's morals, beliefs and final wishes. If doubt exists as to whether the life insurance proceeds would be used properly, it is usually best to address those concerns before designation.