Which of the following statements about the per stirpes concept is correct?

• A. I only
• B. II only
• C. Both I and II
• D. Neither I nor II

Answer: (A)

Per stirpes distributes life insurance proceeds by branch of the family, not by the individuals who are alive at the moment of death. Each original beneficiary’s share is assigned to their branch, and that share is then passed down to the living descendants of that beneficiary. The idea is to represent the deceased beneficiary through their own line, so the inheritance stays connected to the family line you intended.

For example, if the insured names three children and one child dies before the insured but leaves two grandchildren, per stirpes would allocate one third of the proceeds to the living child, and the deceased child’s one third would be split between the two grandchildren. If no descendants survive from a particular branch, that branch’s share may go to the other branches or to the estate depending on the policy terms.

This approach contrasts with a per capita basis where, if a beneficiary dies, their share is redistributed among the surviving beneficiaries at the time of death, which can alter the intended distribution.

If you share the exact statements I and II, I can point out which one correctly reflects this representation-by-branch principle.