Life insurance, is it part of the inheritance?
Specifically, if the heirs, because they are heirs, have the power to distribute it along with the rest of the inheritance
It seems the most logical thing, since it is an amount that is received after death, to think that it is part of the insured's assets, so <
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Well, it's not like that, and it's not because of the difference between life insurance and inheritance.
Is life insurance part of the inheritance?
When a will is opened, the next step is to distribute the testator's assets among those he has decided, respecting what corresponds to the heirs by law.
This distribution includes the entire assets of the person who has just died.
Life insurance is a product that we decide to take out so that, after our death, a certain amount falls to whoever we have decided, generally family members, as financial help for their future.
Life insurance is, then, something independent of the inheritance , and cannot be linked to its distribution.
That person we decide can be anyone, it is true that they are generally children , spouses , or any other family member, but it does not have to be that way, and we can choose a friend, or even some organization or entity outside the family.
That person or entity is the
It is an amount agreed upon with an insurance company through a contract, by which, after death, someone, determined by the insured, receives a certain amount of money.
This is the insured capital , which is the maximum amount charged when the conditions established when contracting the policy are met.
All rights and obligations, both of the insured and the insurer, are regulated in the Insurance Contract Law .
As we say, it is the person, or entity, in whose name the insurance we contract is directed , whether or not it is a family member.
With this, it may be the case that it is one of the heirs , or all of them, then they do receive it, but regardless of the inheritance.
We give you an example.
Life insurance that has as beneficiary the eldest
The inheritance is distributed, as established by law, between the three brothers and, in addition, the eldest receives the insurance amount without the others having anything to do with it.
Only in the case in which all the children are listed as beneficiaries, should it be distributed among the three.
In short, and what must be taken into account, is that an heir, unless he is a beneficiary and is recognized as such, does not receive anything from the life insurance.
The insurance has no beneficiary, how is it distributed?
It is not usual, since the objective of life insurance is that, when that person dies, whoever they decide, is protected with an amount of money.
But even so, if this were the case, and a life insurance policy did not indicate a beneficiary, then yes, then it becomes part of the estate and will be distributed among his heirs accordingly, as another part of the estate.
It is the exceptional case in which insurance can be considered part of the inheritance.
#02.-Who inherits life insurance?
Life insurance is not inherited because it is not part of the inheritance.
Life insurance is received by your beneficiary
It does not participate in the distribution unless one of the heirs is determined as beneficiary, as he or she is not part of the estate.
A legal figure that is established in art 659 of the Civil Code as the total assets that a person leaves after his death, all the assets, economic or not, that belonged to him and that, at that moment, must be distributed among whoever he decides. , and among his legal heirs.
I renounce my inheritance, can I collect life insurance?
Yes, there is no problem, you cannot be denied that right if you are its beneficiary.
Insurance and inheritance are independent in all aspects and have nothing to do with each other, you can approach each one in the way you think most interests you, without one decision affecting another.
Can heirs claim life insurance?
If they are a beneficiary of the insurance, yes they can , it is their right since that amount is for them.
If
Heirs can claim life insurance
The first exception is a case that we have already told you about, when there is no clear beneficiary established , then, let us remember that it is intended for the heirs, with an equitable distribution among all of them.
The second is different, when it is proven that the beneficiary is the cause of the death of the insured, deliberately, which the legislation calls fraud.
Someone who, knowing that they are the recipient of that amount, for example, causes an accident or causes death in any other way just to speed up the time of receiving that money.
Tax implications of life insurance
Life insurance is taxed with the Inheritance and Donation Tax at the time the beneficiary collects it.
This tax taxes the transfers of goods and rights that people receive when they increase their assets without consideration , without doing or giving anything in exchange.
Regulated by state law, it is the Autonomous Communities that are in charge of collecting it, and in each one, a specific amount is established.
The beneficiary must pay this tax in the same way as if he had obtained an inheritance, and the amount depends on the amount he receives from the insurance itself, as well as the degree of relationship, if an heir or relative is the beneficiary.
In any other case, when it is not someone so close, the relationship between the policyholder and the beneficiary is taken into account .
Life insurance is not part of a person's assets, its amount does not depend on what the insured had achieved throughout their life, it is a contract independent of everything, which establishes the amount that will be collected after death.
This independence means that it is not considered part of the inheritance to be distributed, so the heirs cannot, with some exceptions, claim it in the will.
With all this, we advise you to put yourself in the hands of a lawyer specializing in inheritance law , who will best advise you and find the appropriate solution for your case.
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