The beneficiary, who receives compensation in the cases provided for by an insurance policy, is undoubtedly a major part of our insurance contract. It also takes on special relevance in life insurance to be the one who receives the economic benefit that allows him to continue with his habitual life after the death of the insurance holder, which in many cases contributes a good part of the income of the family unit.
Payment of the taxes
Therefore, designating a beneficiary is always essential. There are no limits when it comes to setting beneficiaries and anyone can be, regardless of whether or not they have a kinship relationship with the payment of the taxes, but if a big difference when determining it expressly or generically .
How to choose the beneficiary
It must be taken into account that any person can have the status of beneficiary of life insurance, since it is the insured who designates it, regardless of whether it is related to the insured or not. The beneficiary can be a natural or legal person, normal comes first, and can be designated in the two ways we have advanced:
- Express: When the beneficiary is identified with names and surnames in the case of a natural person or CIF or Corporate Name in the case of a legal person.
- Generic: It does not designate a specific person, but indicates the degree of kinship (father, mother, children, grandchildren …).
It is important to note that it is not mandatory to designate beneficiary, but doing so facilitates the work of collecting life insurance. When doing so, it can be done in two ways:
- In the policy itself: It is the simplest and most common way. It can be done at the time of hiring, but also designate or modify at any time of validity.
- In the will : Designating beneficiary by policy, or in general for all those who are subscribed.
If there were no beneficiaries, it would be the heirs who would receive the outstanding capital.
This designation allows the payment of the economic benefit stipulated in the policy and also to be able to be informed, directly in the insurance company or in the Registry of Insurance Contracts of death coverage , under the Ministry of Justice of the existence of a life insurance.
Payment of the taxes
But this charge is also subject to a fundamental obligation, the payment of the taxes stipulated in this case by the Autonomous Community (organism that regulates the Inheritance Tax) on the amount it receives. Therefore, correctly determine the beneficiaries of insurance and that they know their rights and obligations will allow both to better determine their benefits and objectives and in the last step, make their collection more agile.