The term primary beneficiary refers to an entity that will be the leading recipient of the named assets dispensed from a will, insurance policy, or trust. As the name implies, there can only be one primary beneficiary of an agreement.
Also referred to as the sole beneficiary, the primary beneficiary is the "first in line" to receive the assets from an insurance policy, will, or trust. There is normally only one primary beneficiary in an agreement; however, if several entities are named as primary beneficiaries, then the assets are divided equally among these parties.
While a primary beneficiary is oftentimes a person, it can also be a trust, an estate, or even a charitable organization. When an individual's estate is named as the primary beneficiary in an insurance policy, the assets are distributed as described in the individual's will. Contingent beneficiaries are oftentimes identified in these same agreements in the event the donor outlives their primary beneficiary, or they are otherwise unable to receive the donor's assets.