What is a beneficiary: basic definitions

2024 Author: Henry Conors | [email protected]. Last modified: 2024-02-12 02:47

When asked what a beneficiary is, the answer is the following list of legal entities and individuals:

1. Deriving income from personal property held in trust or used by third parties. An example is the leasing of movable and immovable property or the transfer to the use of stock brokers.
2. Designated Beneficiaries. At the same time, what is a beneficiary can be seen in the insurance policy, since property insurance can be carried out in favor of an outsider. In the event of the death of the beneficiary before the payments, the heir acts as the beneficiary.
3. Specified by the issuing bank as the owner of a documentary letter of credit.
4. Receiving cash collection.
5. Receiving a bank certificate.

What is a beneficiary?

Thus, it is the recipient of various benefits and benefits, income and profits, as well as cash payments in accordance with a debt document or contract.

You can often find the term "beneficiary" in specialized literature. However, this is a complete analogue of the concept under consideration.

The order of definitionbeneficiary

In the process of registering an offshore company, the director, shareholder and secretary are first registered.

However, the real name of the final recipient of the profits is very rarely mentioned. Thus, when determining what a beneficiary is, it is safe to say that this is the real owner of the company. It is understood that this is some natural (legal) person who is actually the owner of the company, but at the same time, in accordance with the constituent and registration documents, this enterprise belongs to other persons. The beneficiaries of a legal entity are the real owners of its assets. Often, under this definition, you can meet an exporter in accordance with the concluded special agreements. It is customary to consider two terms as synonyms for this concept: “profit recipient” and “beneficiary”. However, its semantic meanings are:

- beneficiary - recipient of annuity;

- beneficiary under a documentary letter of credit - a person for whom a bank opens a letter of credit;

- a person who receives rent as income when renting out an object;

- this is the heir upon receipt of an inheritance by will;

- this is also the recipient of the sum insured when applying for the corresponding policy; for life insurance, the contract may contain a clause about the recipient of the payment (any person can be indicated).

Rights of the beneficiary

This issue has already been reflected in domestic legislation. Highlyclearly the rights of such an individual (legal) person can be considered on the example of lending. Especially if the beneficiary acts as a bank guarantor, as a creditor who has the right to receive funds. An insurance organization or a bank issues a written document to the beneficiary as a bank guarantee for the said payment.