There are several types of beneficiary designations. Following are definitions of the most common:
Spouse, if Living, if not, Living Lawful Children Equally with Rights of Survivorship — With this designation, a person's spouse is the beneficiary. If the spouse is deceased, the children legally born to or legally adopted (living lawful) by the owner will share equally in the proceeds. If any of the children are deceased, the proceeds are divided equally among the surviving children.
Spouse, if Living, if not, Living Lawful Children Equally with Rights of Survivorship Per Stirpes — Per Stirpes is a Latin phrase meaning, per branch. It is incorporated into last will and testaments and estate planning as an instruction to pay an equal share of an estate to each branch of the testator's family. With this designation, a person's spouse is the beneficiary. If the spouse is deceased, the owner's living lawful children will share equally in the proceeds. If one of the owner's children is deceased, that child's living legal children receive his or her portion of the proceeds.
Living, Lawful Children, Equally with Rights of Survivorship — With this designation, the owner's living lawful children are the beneficiaries. If any of the children have died, those shares are divided equally among the surviving children.
Living, Lawful Children, Equally with Rights of Survivorship Per Stirpes — Per Stirpes is a Latin phrase meaning, per branch. It is incorporated into last will and testaments and estate planning as an instruction to pay an equal share of an estate to each branch of the testator's family. This designation is an instruction to pay the children legally born to or legally adopted by the owner equally. However, if a child of the owner has died before the owner, the share the child would have received if he/she had survived the owner will be paid to his or her legally born to or legally adopted by children of the deceased child, per stirpes. Stepchildren and foster children are not included in this definition.
If you have stepchildren, foster children, or are unsure if using this terminology will accomplish your future settlement objective, you may consider naming the specific individuals by name and relationships instead of choosing pre-defined options on the form. This will help clarify who you specifically want to receive beneficiary proceeds at claim time.