What does the Common Disaster clause stipulate regarding proceeds in the event of a common accident?

The Common Disaster clause is designed to address situations where both the insured and the beneficiary die as a result of the same accident or event. In this scenario, the clause operates under the presumption that if the beneficiary dies simultaneously or shortly after the insured, the proceeds of the policy will be directed to the insured's estate rather than going directly to the beneficiary.

This design aims to prevent the unintended consequence of the insurance proceeds being disbursed to a beneficiary who has not survived the insured and ensures the policy benefits are handled according to the deceased insured’s wishes or estate plan. It helps clarify the allocation of benefits in complex situations where the timing of deaths can be ambiguous.

While other responses indicate alternative distributions of proceeds, they do not reflect the primary purpose of the Common Disaster clause, which is specifically about ensuring that the benefits fall back on the insured's estate in case of simultaneous demise or immediate proximity in time.