Understand who your life insurance beneficiary is and how to choose the people you want to protect with your policy!
One of the most important policy choices is the life insurance beneficiary, and if you don’t know what that means, you may have a hard time getting the right product.
This is one of the most popular terms within this universe. After all, it is one of the pillars for the composition of your toppings. However, few people stopped to understand what this function actually means.
In this case, for you to make assertive choices when putting together your policy, it is essential to pay attention to who may or may not participate in your protection.
For this reason, we have prepared special content to explain who is the beneficiary of life insurance, what is their role and how to determine them when hiring. Check out!
What is the life insurance beneficiary?
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The beneficiary of life insurance is the person who will receive compensation in the event of an accident. In practice, it’s the individuals you want to protect if an unforeseen happens.
When you seek to take out a policy, the insurer will certainly ask who your beneficiaries will be. In the future, if you need to trigger financial support, these people will be contacted.
It is worth emphasizing that the insured person is free to choose his own beneficiaries, and change them in the future, if necessary.
Who can be a beneficiary of life insurance?
In practice, any financial dependent can be your life insurance beneficiary, whether an individual or legal entity. However, there are some common choices, such as:
- Children ;
- Members of the family;
- Trusted people;
It is possible to have more than one life insurance beneficiary, and even define the percentage of compensation that each person will receive in case of claims, in any amount, be it $50,000 or $1million.
In addition, some insurers also allow you to determine your primary and secondary dependents, in case one of the individuals cannot receive payment, as in the case of minors, for example.
How to choose a life insurance beneficiary?
The main recommendation for choosing your life insurance beneficiary is to prioritize the people who are financially dependent on you.
In this way, in the event of claims or unforeseen events, it will be possible to offer adequate support, in addition to more peace of mind to plan the next steps.
For this reason, many end up protecting family members, as they are directly linked to their income or care.
However, if there are other important relationships you want to protect, they may also be your life insurance beneficiaries.
Before making this decision, try to assess the degree of importance of each individual, their needs and how many options the insurer makes available in the policy.
What is the difference between a life insurance beneficiary and a legal heir?
The life insurance beneficiary is any person chosen by the holder when taking out the policy , while the legal heir has a degree of legal kinship with the individual, in accordance with the rules of the law.
In this sense, if the holder dies, the beneficiaries receive payment of the indemnity of their insurance, and the heirs are indicated to divide their assets, goods and values.
It is common that there are doubts about the two concepts, because they are similar, and can be related at some point. After all, if there are no beneficiaries in your insurance, the legal heirs are automatically indicated.
However, it is important to reinforce that the payment of compensation will prioritize the recommendations that the holder makes in his policy, whether they are direct relatives or not.
In addition, this direct payment only takes place for compensation, as insurance is not included in the division of assets. Other assets continue to be owed to the legal heirs.
What are the rights and obligations of the life insurance beneficiary?
In the policy, it is the right of the beneficiary of the life insurance to receive the indemnity and the benefits of the policy as agreed between the parties in the event of an accident.
Payment must be made within the period recommended by the Superintendence of Private Insurance (SUSEP) , directly to the nominees.
Since the amount should not be included in the inheritance division, the nominees are entitled to receive the full amount, or the percentage corresponding to the claim.
On the other hand, the beneficiary of life insurance has few duties, but needs to pay attention to them, to be eligible to receive compensation. For example, it is essential to submit documents related to the claim when required.
If the insurer carries out an analysis of the claim, beneficiaries must wait for the result before resorting to any action.
When can life insurance beneficiaries be changed?
You can change your life insurance beneficiary at any time when you feel it is necessary.
As long as the policy is up-to-date and the coverage is in force, the holder can modify the dependents whenever he feels the need.
However, it is essential to emphasize that only the insured can make this change, presenting their identification documents and following the company’s procedures.
Is there a number of beneficiaries in life insurance?
Legally, there is no maximum number of beneficiaries in life insurance, and the holder is free to choose as many people as he wants.
In addition, some insurers may have a commercial and underwriting policy with specific recommendations. Therefore, it is worth checking with the chosen company before choosing your dependents.
How do I know if I am a beneficiary of life insurance?
To find out if you are a beneficiary of life insurance, there are some channels available, such as contacting the holder or insurer, providing your data for research.
What happens when a policy is missing from a life insurance beneficiary?
If there is no life insurance beneficiary, the legal guidance is to direct the indemnity, in accordance with the rules of the civil code. This means that the payment must be made at 50% for the spouse not legally separated, and 50% for the legal heirs.
Therefore, if you want to protect your loved ones, remember to register them in your policy to receive compensation if something happens. Enter all the correct data, so that it will be possible to locate these people in the future.