A beneficiary is someone who receives a profit, help or right.
Beneficiary is a term used to refer to a person or entity that receives some type of benefit, gain , assistance, or right, generally as a result of some agreement, contract, program or particular situation. In legal, financial or insurance contexts, the beneficiary is the one who receives the payments stipulated in a contract, such as in life insurance where the stipulated amount corresponds to him in the event of the death of the insured.
Classification
Beneficiary types in various contexts, such as insurance , wills, and other legal agreements, can be classified into various categories depending on their relationship to the benefit holder and their position in the process of receiving benefits.
- Direct beneficiary : direct recipient of the benefits or assets, without additional intermediaries. For example, in a life insurance contract, this would be the person designated to receive payment in the event of the death of the insured ;
- indirect beneficiary : the benefits can be channeled through a trust, in which the settlor transfers ownership of certain assets to the trustee, who manages said assets for the benefit of the final beneficiary;
- primary beneficiary – the primary recipient of benefits or assets as stipulated in an agreement or contract. If there is more than one designated beneficiary, this one has priority;
- secondary beneficiary : receives benefits if the primary is unable or unwilling to accept them;
- nominal beneficiary : explicitly designated by the owner of the contract or agreement, with his or her specific name mentioned in the relevant documents;
- beneficial owner : beneficial or ultimate beneficiary, especially when there are complex ownership structures or intermediaries involved. This term is often used in legal and financial contexts to identify the person or entity that actually benefits from an arrangement or situation, beyond formal designations.
The heir and the legatee are two examples of beneficiaries in the legal field.
Heirs and legatees
The terms heir and legatee are used in the field of inheritance law to refer to people who receive assets or rights from a deceased person, but they differ in the way in which they acquire them and in their nature.
Heirs
- Those who are entitled to receive the assets and liabilities of a deceased person in accordance with applicable inheritance laws or will;
- the inheritance is distributed among the heirs according to the rules of the country or state where the death occurs, unless there is a valid will stating otherwise;
- They are usually close relatives of the deceased, such as spouses, children, parents or siblings, depending on inheritance laws and individual circumstances;
- They receive their share of the inheritance after the debts and obligations of the deceased have been settled and the legal procedures necessary for the distribution of assets have been completed.
Legatees
- Persons or entities specifically designated in a will to receive assets or rights from the deceased's estate;
- they receive specific assets or rights that have been clearly identified and separated from the rest of the estate;
- Legacies can be of various types, such as sums of money, property, works of art, jewelry, or any other type of property or rights that the deceased decides to bequeath to specific people or entities;
- They may or may not also be full or partial heirs, depending on how it was provided for in the deceased's will.
Social beneficiary
The term social beneficiary refers to individuals, groups or communities that receive help, support or benefits from charitable programs, donations or aid. These people, the donees, usually find themselves in situations of economic, social or health vulnerability , and depend on the assistance of charitable organizations, government institutions or other social actors to cover their basic needs or improve their quality of life.
In the context of charity and philanthropy, social beneficiaries can include homeless people, people with some type of disability, low-income families, children at risk, older adults, victims of natural disasters, among others. The donation may include food, clothing, shelter, medical care, education or other types of help provided by charitable organizations, foundations or volunteers committed to the well-being of the community.
Recipients of donations and aid can be identified through needs assessments, community surveys, or through collaboration with local institutions, such as social service centers, hospitals or schools. It is important that supporters and donors ensure that those who benefit are those who need help and protection the most and that they use it effectively to address the underlying causes of poverty or vulnerability .
The social beneficiary receives help to cover his or her fundamental needs.
Rights and responsibilities
The rights and responsibilities of a beneficiary may vary depending on the context in which it is located and the specific circumstances of the agreement or contract in question. Let's start with rights, talking about the creditor in a financial agreement , who has the right to receive payments or benefits as stipulated therein.
A pensioner , on the other hand, is entitled to receive periodic pension payments in accordance with the terms of the pension or retirement plan. The guardian of an estate or trust can manage the assets for the benefit of the designated beneficiaries, ensuring their well-being and protection. The depositary is entitled to receive the deposited assets and use them in accordance with the terms of the deposit contract.
Regarding the beneficiary's responsibilities, we can start by talking about his potential debts, which he must pay off in accordance with the agreed terms. If it is a worker who receives a subsidy or sponsorship to carry out a project or activity, he or she is obliged to carry out the work diligently and meet the objectives established in the contract.
If the beneficiary receives insurance coverage , he or she is responsible for complying with the conditions of the policy and for reporting any claims or losses in accordance with the procedures established by the insurance company. If you have a financial or investment account , you have the obligation to manage it prudently and in compliance with applicable laws and regulations.
The beneficiary may be subject to the terms of a legal agreement or agreement that sets out his or her rights and responsibilities in relation to certain assets or benefits. If you receive a grant or financial assistance from the government or another entity, you may be required to use those funds for their stated purposes and to report their appropriate use. In some cases, a beneficiary may be required to provide a guarantee or guarantee to support certain financial commitments or contracts, assuming liability in the event of default.