Annuity beneficiary designation is the instruction on an annuity contract that specifies who will receive remaining benefits upon the ownerTMs or annuitantTMs death. Beneficiaries can be individuals, trusts, charities, or entities, and designations may include primary and contingent beneficiaries, as well as per stirpes or per capita language. For qualified annuities, beneficiary choices interact with post-SECURE Act distribution rules, such as 10-year distribution requirements for many non-spouse beneficiaries. Clear annuity beneficiary designations help avoid probate, reduce delays and disputes, and ensure that the annuityTMs remaining value is distributed in accordance with the ownerTMs estate planning intent.

Advisors regularly review annuity beneficiary designations during annual meetings and before major life events such as marriage, divorce, births, or deaths. They coordinate designations with overall estate plans, trust provisions, and tax considerations, particularly for large nonqualified contracts or retirement accounts. When completing new applications, advisors ensure that beneficiary forms are detailed and legible, avoiding ambiguities like "children" without definitions. Claims departments rely heavily on the beneficiary designation to process death benefits smoothly. Understanding annuity beneficiary designations helps advisors prevent unintended outcomes, align annuity payouts with trust and will provisions, and communicate clearly about the tax and timing implications for heirs.