What does "per stripes" mean in terms of beneficiary designations?

The term "per stirpes" is a legal concept commonly used in estate planning, including beneficiary designations. It refers to how an inheritance or benefit is distributed among the descendants of a deceased beneficiary. Specifically, it means that if a named beneficiary passes away before the policyholder, their share of the benefits will be divided equally among their children or direct descendants. This ensures that the deceased beneficiary’s portion is preserved within the bloodline and passed down, maintaining the intended distribution among family members.

In the context of life insurance and beneficiary designations, choosing "per stirpes" ensures that each branch of the family receives an equitable share, even if one of the branches has lost a member. This method allows for a straightforward transfer of benefits, minimizing potential disputes among heirs and adhering to the wishes of the policyholder.

This option aligns with how many people wish to ensure their assets are distributed fairly according to family lineage, ensuring that wealth remains within the family line.