What characteristic defines a contingent beneficiary?

A contingent beneficiary is defined as a person or entity designated to receive the benefits of an insurance policy only if the primary beneficiary is unable to do so. This means that if the primary beneficiary survives the insured, the contingent beneficiary does not receive any proceeds from the policy. This characteristic is fundamental to the role of a contingent beneficiary, as their claim to the insurance proceeds is contingent upon the primary beneficiary's status. While the other options mention aspects like immediate receipt of proceeds, the ability to change designations, or entitlement to dividends, these do not accurately capture the essential nature of what a contingent beneficiary represents in policy terms. The contingent beneficiary is essentially a secondary option, activated only under specific circumstances, which is central to understanding their role in insurance contracts.