Per Stirpes Life Insurance: How It Protects Your Grandchildren

**Per stirpes** (Latin for "by branch" or "by roots") is a beneficiary designation that ensures if your child dies before you, **their children (your grandchildren) inherit their parent's share**.

• Protects grandchildren from disinheritance
• Distributes by family branch, not by individual
• Common in life insurance, IRAs, 401ks, and trusts
• Alternative to "per capita" distribution

When you designate beneficiaries "per stirpes" on your life insurance policy, the death benefit is divided by family branches, not by individual beneficiaries.

• First, divide benefit by number of your children (branches)
• If a child is alive, they receive their share
• If a child has died, their share passes to their children (your grandchildren)
• Grandchildren split their deceased parent's share equally

These examples show exactly how per stirpes affects life insurance distribution.

• **Example 1: All Children Living**
• $600,000 policy, 3 children named per stirpes
• Result: Each child receives $200,000
• Per stirpes has no effect because all named beneficiaries are alive
• **Example 2: One Child Deceased with Children**
• $600,000 policy, 3 children named per stirpes
• Child #2 died before you, leaving 3 grandchildren
• Result:
• - Child #1: $200,000
• - Child #3: $200,000
• - Grandchild A (from Child #2): $66,667
• - Grandchild B (from Child #2): $66,667
• - Grandchild C (from Child #2): $66,667
• **Example 3: One Child Deceased with NO Children**
• $600,000 policy, 3 children named per stirpes
• Child #2 died before you, had no children
• Result: Child #1 and Child #3 each receive $300,000
• The deceased child's share is redistributed to surviving siblings

Understanding the difference between per stirpes and per capita is crucial for proper beneficiary planning.

• **Per stirpes:** Keeps inheritance "in the family line"
• **Per capita:** Divides equally only among those alive
• **Per stirpes:** Protects against unintended disinheritance
• **Per capita:** Simpler but excludes grandchildren of deceased children

Adding per stirpes to your life insurance beneficiary designation is simple but critical.

• **Alternative wording to look for:**
• "By representation" (means the same as per stirpes)
• "By right of representation"
• "To issue" or "lineal descendants"
• **Red flags:**
• Form has no per stirpes option - contact insurer to add it
• Form only allows individual names - request per stirpes language
• Online form doesn't include per stirpes - use paper form

1. 1**Contact your insurance company** and request beneficiary designation form
2. 2**Name your children as primary beneficiaries** with percentage splits (e.g., 33.33% each)
3. 3**Add "per stirpes" language** - usually a checkbox or write "per stirpes" after each name
4. 4**Specify contingent beneficiaries** in case all primary beneficiaries predecease you
5. 5**Submit form** and request written confirmation