A very common question from those who are researching insurance is whether Life Insurance enters the inventory. Well, the answer to it is quite simple: no, life insurance doesn’t go into the inventory. In fact, there are many differences between this type of insurance and the sharing of an inheritance. For example, in the case of inheritance, only legal heirs can benefit from the assets left by the deceased, while in Life Insurance there is no such requirement.
What is inventory?
Inventory is the process that takes place after the death of a person, and can occur judicially or extrajudicially and with a maximum period of 60 days for its beginning. Its purpose is to share the assets and debts of the deceased, ensuring a fair succession for each legal heir. This process can be requested by any interested person, whether spouse, children, or even creditors.
How it works?
From the moment the inventory process begins, in a judicial inventory, the first thing to be done is the appointment of an administrator who will be the person responsible for taking care of the assets in question and ensuring the progress of the action until the end. .
If the heirs are all of age, the sharing of assets will take place more quickly, as long as everyone is in agreement. If there are minors, it will be necessary to wait a little longer until the judge’s approval.
The division of assets can follow the deceased person’s will (if he left one) or what is stipulated by law. It is expected that the spouse will receive 50% of the inheritance, while the children will share the other half according to the hereditary order.
If someone feels wronged, it is possible to take legal action to recover some benefit. This can be useful in the case of children who were not recognized in life or who are the result of an extramarital relationship.
What is Life Insurance?
As with other types, Life Insurance guarantees protection against situations that may result in the death of the insured, providing an indemnity to the beneficiaries, stipulated in the contract, if this fatality occurs.
Its operation is very similar to that of other modalities, in which the contractor includes the coverage he wants, pays the insurance premium monthly or annually and is entitled to coverage in cases where the policy allows.
It is worth mentioning that the insurance holders do not benefit from the indemnity, only the listed beneficiaries. In addition, there is the possibility of flexibilizing the way in which compensation will be paid and even including funeral assistance in some cases.
Who is entitled to Life Insurance?
Any person of interest to the contractor can be a Life Insurance beneficiary. In other words, it is entirely possible to include friends, neighbors, relatives and even spouse and legal heirs to fill this position.
The only detail to pay attention to is that beneficiaries can only receive the appropriate compensation if they are of legal age, that is, at least 18 years old. Otherwise, the money will be withheld until the beneficiary person reaches the age of majority.
Does life insurance go into the inventory?
Life Insurance is not included in the inventory because it is not an asset accumulated during the life of the holder. In other words, as this money was never part of the contractor’s real estate, it cannot be counted as equity.
In addition, as this is an indemnity paid to beneficiaries after the death of the holder, the amounts of money will be made available within a period of up to 30 days after the request is made.
Just to be clear whether life insurance goes into the probate or not, the answer is no. Keep this in mind.
After all, what is the advantage of Life Insurance?
So far it has been evident that Life Insurance is a great tool used to protect the people we love, regardless of the existing blood relationship. In addition, there are other benefits that this type of insurance offers. Check it out below!
- Possibility of indicating any person : unlike the inheritance, it is totally possible to include any person in the list of beneficiaries, without major restrictions;
- no need to take inventory to access compensation : unlike sharing the assets of an inheritance, the amount intended for beneficiaries is available within a maximum period of 30 days — which reduces the waiting time;
- there are no state taxes : unlike inheritance, it is not necessary to pay ITCMD to have access to financial resources;
- there is no withholding by the court : since the beneficiaries will receive money that was never part of the deceased’s estate while he was alive, the court cannot freeze the financial resources to pay off possible debts left by the contractor.
How to get Life Insurance?
Once you understand that it is very advantageous to have a Life Insurance to protect your family and friends, it remains to know what to do to have more details about this type of insurance.
The first thing to do is to find out a little more about how this product works, trying to understand conditions, fees, premium amounts to be paid , duration of coverage (when applicable), among other things.
This whole process can be streamlined if you have someone to guide you and answer your questions. Therefore, in these cases, the most recommended thing is to talk to a well-trained professional to guide you and show you the best path to take, by clarifying fundamental legal issues of both the inheritance and Life Insurance process.