Per Stirpes and Per Capita ***

• per stirpes passes through the blood
• per capita passes to a "named beneficiary"

MR. WATSON: The problem is if there is more than one beneficiary on a level, and one of those beneficiaries is dead, where does the deceased's share go? Does it go to the other living beneficiaries on that same level? Or, will it pass through his/her bloodline?

MR. WATSON: It will be either "per capita" or "per stirpes". So "per stirpes" passes by blood. Benefits are "per stirpes" by default (See per stirpes rule ).

MR. WATSON: It's either "per capita" or  "per stirpes." What does "per capita" mean? It means named (See per capita rule ). Now, y'all ready for an example?

ALL: Uh-huh.

MR. WATSON: Hank has a $100,000 policy.

MR. WATSON: Hank is the insured. Names his wife, Wank, as the beneficiary. They have a son named Luke, and they have a daughter named Duke. Luke has a son named Puke. You better write this down! See chart below.

MR. WATSON: Puke (the grandson) is not named as a beneficiary.

MR. WATSON: I'll tell you three stories, and you tell me what happened.

MR. WATSON: Once upon a time Hank (the insured) died. Now who gets the money?

ALL: Wank the wife (the primary).

MR. WATSON: And it's all over, end of story, the death benefit is paid to the primary. Y'all agree?

ALL: Yes.

MR. WATSON: So let me give you another story. Once upon a time, Wank (the primary beneficiary) died first, before Hank, the insured. Then Hank dies. Now where does it go? Half goes to Luke the son (secondary) and half to Duke the daughter (secondary). Y'all agree?

ALL: Yes.

MR. WATSON: Let me give you the third story. Once upon a time, Wank the wife (primary) and Luke the son (secondary) died in an accident before Hank, the insured. Now Hank (the insured) dies, where does the money go? $50,000 goes to Duke (the living secondary), and Luke's share passes through his seed, per stirpes, to the child Puke (not a beneficiary). It is per stirpes by default. Is this what Hank wanted? Think about a divorced couple. Maybe, maybe not.

MR. WATSON: Hank, to have prevented this, he could have said, "I want Luke and Duke per capita." That way, only the named living beneficiaries would have received the money. The deceased's share would pass to the surviving beneficiary, if named "per capita".

MR. WATSON: If you don't write the words in, "per capita," then it will automatically pass by blood, through the blood, to this guy's offspring. Per Stirpes! This only applies when you have multiple beneficiaries on the same level and one of them is dead. We want to know, "Where does his/her share go?"

MR. WATSON: We want to know, if this guy (the beneficiary) died, what happens to his share of the benefit? What happens to his share if he dies? Y'all understand? His share will go through his blood, per stirpes.

WOMAN: But what if there isn't any blood?

MR. WATSON: Then nobody cares. His share would go the surviving beneficiaries.  It's a moot point. Nobody cares.

MR. WATSON: Per stirpes, passes by blood; per capita means named.

MR. WATSON: Is it clear, everybody?

ALL: Yes.

WOMAN: What if every single one of them die in a freak accident?

MR. WATSON: The estate, remember? You ask a good question. Y'all just hang on. We're going there again.