Massachusetts Health & Accident Insurance Practice Exam

What does the "Tertiary" benefit refer to in insurance policies?

1. The second beneficiary to receive benefits

2. Third to receive death benefits if no one is insured

3. A type of insurance for children

4. Last in line for medical expenses coverage

The correct answer is: Third to receive death benefits if no one is insured

The "Tertiary" benefit in insurance policies refers to the concept of a beneficiary hierarchy, where benefits are distributed based on a predetermined order of entitlement. In this context, the tertiary beneficiary receives benefits only if the primary and secondary beneficiaries are not available to collect. This typically occurs in situations such as death benefits, where the first to receive benefits is the primary beneficiary, followed by the secondary beneficiary, and if neither is present or able to claim, the tertiary beneficiary would then be entitled to receive the remaining benefits. This understanding reflects the structure and intent behind beneficiary designations in various types of insurance policies, ensuring that benefits are systematically allocated according to the insured's wishes. The notion of a tertiary benefit fundamentally underscores the importance of carefully designating beneficiaries in life insurance and other related policies to ensure that the intended recipients receive their rightful share of benefits.