What happens if the primary beneficiary dies before the insured and no contingent beneficiaries are named?

In the scenario where the primary beneficiary dies before the insured and there are no contingent beneficiaries named, the correct outcome is that the proceeds are paid to the insured's estate. When a primary beneficiary is designated, the policyholder intends for that individual to receive the death benefit. However, if that beneficiary predeceases the insured and no alternate arrangement has been made through a contingent beneficiary, the legal framework of the insurance policy dictates that the death benefit should then go to the insured's estate.

This is based on principles of inheritance and estate law, which ensure that assets are distributed according to the will of the deceased or to statutory heirs if no will exists. Since the primary beneficiary is no longer alive to receive the proceeds, the death benefit is then treated as part of the insured's estate and is subject to probate proceedings. The proceeds would be distributed according to the terms of the will or, in the absence of a will, according to state intestacy laws.

This outcome underscores the importance of regularly reviewing and updating beneficiary designations to ensure that the policyholder's intentions are fully met after their passing. It also highlights the necessity for policyholders to consider naming contingent beneficiaries to avoid complications in such scenarios.