Per Stirpes vs. Per Capita in 2026: How Life Insurance Beneficiaries Are Divided
Two words on a life insurance beneficiary form decide whether an entire branch of your family inherits — or gets nothing. “Per stirpes” and “per capita” are the two main ways a death benefit is divided when a beneficiary dies before you do, and the difference between them is not a technicality. It can redirect hundreds of thousands of dollars away from your grandchildren and into your surviving children’s pockets.
Yet many people leave the box unchecked, letting a carrier default decide the outcome. This guide explains exactly what per stirpes means, how it differs from per capita, why the phrase “by representation” is legally dangerous, and how retirement accounts and group policies treat the choice differently from a will. It also walks through how to make the designation correctly so the family you intend to protect actually receives the money.
What “Per Stirpes” Means
Per stirpes is Latin for “by branch.” When you name beneficiaries per stirpes, you are telling the insurer that each beneficiary represents a branch of your family tree. If a branch’s person is alive when you die, they take their share as expected. If that person has already died, their share does not vanish and does not get redistributed sideways — it flows down that branch to their own descendants, split equally among them.
Per capita is Latin for “by head.” Under a per capita designation, the death benefit is divided equally among your surviving named beneficiaries only. It does not look downstream. If a named beneficiary has died, their share is simply reallocated among the survivors, and their children receive nothing because they were never named.
Per Stirpes vs. Per Capita: A Worked Example
The clearest way to see the difference is with numbers. Suppose you have a $600,000 policy and you name your three children — Alex, Beth, and Chris — as equal beneficiaries at $200,000 each. Beth dies before you, leaving two children of her own.
| Outcome | Per Stirpes | Per Capita |
|---|---|---|
| Alex (surviving child) | $200,000 | $300,000 |
| Chris (surviving child) | $200,000 | $300,000 |
| Beth’s two children | $100,000 each | $0 |
| Total paid | $600,000 | $600,000 |
Under per stirpes, Beth’s $200,000 branch is preserved and split between her two children. Under per capita, Alex and Chris each receive an extra $100,000 and Beth’s children receive nothing. Same policy, same family, same premium — a $200,000 difference created by one unchecked box. If two of the named beneficiaries had died, per capita would concentrate the entire $600,000 on the single survivor.
The Third Option: Per Capita at Each Generation
A third method, called per capita at each generation, is a hybrid that some states and the Uniform Probate Code use. It starts the division at the first generation where at least one member is alive, then pools the shares of any deceased members at that level and divides the pool equally among every surviving descendant one generation down, regardless of which branch they belong to.
| Method | Plain-English Rule | Result When Two Children Die |
|---|---|---|
| Strict per stirpes | A deceased beneficiary’s share stays in their branch | Branches stay equal even if sizes differ |
| Per capita at each generation | Shares are pooled and split equally among that generation | All grandchildren receive identical amounts |
| Pure per capita | Only living members of the named class inherit | One survivor can take 100% |
Most life insurance carriers do not offer per capita at each generation on their standard beneficiary forms in 2026, so if that result is what you want, you typically have to route the death benefit through a trust or a will rather than a direct designation. A few updated 2026 forms now allow a different distribution method on each beneficiary line, so it is worth checking whether your carrier supports mixed designations.
Why “By Representation” Is Dangerous
Some beneficiary forms use the phrase “by right of representation” or “by representation” in place of per stirpes, and in many states the two are treated identically. The problem is that not every state agrees. California Probate Code section 246 treats “by representation” as per stirpes, but New York’s EPTL section 2-1.2 uses “by representation” to describe a pooling method that produces different results when more than one child predeceases you. Writing “to my descendants, by representation” without knowing your state’s definition is one of the most common drafting errors in estate planning. If your form offers this language instead of an explicit per stirpes box, it is worth a five-minute call to your plan administrator or an estate attorney to confirm what it will actually do.
Where Per Stirpes Applies — and Where It Doesn’t
Per stirpes is an option on many kinds of accounts, but the rules are not uniform. A designation on one account does nothing for another, and a will does not control a beneficiary form.
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| Account / Document | Per Stirpes Available? | Notes |
|---|---|---|
| Individual life insurance policy | Usually yes | Checkbox or write-in on the form |
| Annuity contract | Usually yes | Offered alongside per capita |
| 401(k), IRA, 403(b) | Often yes | Carrier defaults vary — Schwab defaults to per capita |
| Will or revocable living trust | Yes | Common in the distribution clause |
| Federal FEGLI group coverage | No | OPM lists per stirpes as unacceptable in 2026 |
Two traps are worth remembering. First, custodian defaults are real: Charles Schwab’s IRA beneficiary designation defaults to per capita, so if you name three children and one predeceases you, that child’s share is redistributed to the surviving two unless you explicitly opt into per stirpes on the form. Vanguard offers a relationship-based “my descendants” option that functions as per stirpes. Second, a will’s per stirpes instruction does not extend to your retirement accounts or your life insurance — those designations supersede the will entirely.
How to Add a Per Stirpes Designation
Getting this right takes only a few minutes per account, but it has to be done deliberately.
- Pull the current beneficiary form for each life insurance policy, annuity, and retirement account.
- Look for the distribution method option. It may appear as a dropdown, a checkbox next to each beneficiary, or a blank line where you can write “per stirpes.”
- Write it after the name if no checkbox exists. The standard notation is “[Full Legal Name], per stirpes.”
- Confirm your carrier or plan administrator accepts the language. Some group plans and federal coverage do not.
- Coordinate with your will and trust. Because beneficiary forms override wills, make sure the choices align.
- Request a confirmation copy after submitting, and keep it with your estate documents.
Mistakes to Avoid
These are the errors that most often cut a family branch out of an inheritance.
- Leaving the box unchecked. The carrier default — frequently per capita — then decides for you.
- Setting it on one account only. A per stirpes designation on your life insurance does nothing for your 401(k).
- Relying on your will. Beneficiary designations override wills, so the form itself must say per stirpes.
- Using “by representation” without checking your state’s meaning. It does not always mean per stirpes.
- Forgetting to update after life events. Births, deaths, marriages, and divorces change who a per stirpes designation affects.
- Never confirming the designation took effect. Institutions occasionally lose paperwork, and only the version on file at your death counts.
Frequently Asked Questions
What does per stirpes mean on a beneficiary form?
Per stirpes means by branch. If a named beneficiary dies before you, their share passes down to their own children in equal parts, rather than being redistributed among your other surviving beneficiaries.
What is the difference between per stirpes and per capita?
Under per stirpes, a deceased beneficiary’s share flows down their family branch to their descendants. Under per capita, that share is redistributed equally among the surviving named beneficiaries, and the deceased beneficiary’s children receive nothing.
Can I use per stirpes on a life insurance policy?
Most individual life insurance and annuity policies offer per stirpes as a checkbox or write-in option on the beneficiary form. Some group plans and federal FEGLI coverage do not accept per stirpes designations.
Does a per stirpes designation on my will cover my life insurance?
No. A life insurance beneficiary designation overrides your will entirely. Per stirpes language in the will does nothing for a policy unless the estate is the beneficiary, so the designation must appear on the policy form itself.
What does by representation mean?
By representation is used inconsistently. Some states treat it as per stirpes, while others, including New York, define it as a pooling method that differs from strict per stirpes when more than one child predeceases you. Confirm your state’s meaning.
Should I choose per stirpes or per capita?
Choose per stirpes if you want each child’s family branch to receive an equal share even if that child dies first. Choose per capita if you want your death benefit divided only among your surviving named beneficiaries.
Related Resources
- NAIC — Life Insurance Beneficiaries: Per Capita vs. Per Stirpes — the insurance regulators’ analysis.
- U.S. Office of Personnel Management — FEGLI — federal group life rules and beneficiary restrictions.
- Uniform Law Commission — the Uniform Probate Code’s per capita at each generation default.
Naming beneficiaries correctly is half of a good estate plan. Start with our guide to intestate succession and life insurance beneficiary rules, then review how life insurance avoids probate and the step-up in basis. Families creating a trust to control distributions should read about the living trust.
Get the Coverage, Then Get It Right
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