What term is used to describe the individual who receives the proceeds from an insurance policy?

The term used to describe the individual who receives the proceeds from an insurance policy is "beneficiary." This is an essential concept in insurance and estate planning, as the beneficiary is the person or entity designated by the policyholder to receive the benefits upon the event of the insured's death.

In most situations, the beneficiary has a right to claim the policy proceeds, which can be critical for financial support during a difficult time following the death of the insured. Understanding this term is vital for funeral service professionals as they often guide families in navigating insurance processes associated with funeral costs and other end-of-life expenses.

Other terms listed are integral to insurance terminology but serve different roles. A benefactor might refer to someone who gives aid, often financially, but does not have a formal role in an insurance contract. The insured is the person whose life or property is covered under the insurance policy. The policyholder, on the other hand, is the individual or entity that owns the policy and has the authority to make changes to it, including designating beneficiaries. Thus, the term "beneficiary" specifically identifies the recipient of the insurance proceeds.