Life insurance is a good investment, especially if you have a family. It provides your relatives with a financial safety net in the event of your death.
With life insurance, your relatives are financially insured if you fall away. In the event of your death, your relatives receive a payout to avoid financial worries in the midst of grief. It is the “beneficiaries” who may be paid a sum or a current benefit in the event of your death.
For example, life insurance can be the reason why your family can stay in your home, even though they now have only one income. If you are alone, you can choose to simply save for retirement and choose a cover in the event of a disability that would make you unable to work. Always remember to check what insurance you may already have through any work or retirement savings to avoid being double-insured (and thus paying too much).
What does life insurance cover?
You can choose to take out life insurance to create a financial safety net for your relatives in the event of your death.
In general, this applies to life insurance:
- The insurance can be taken out when you are between 18 and 49 years
- The insurance is valid until you reach the age of 75.
- An amount is paid regardless of whether the death is due to illness or accident.
You decide for yourself who should have the money and how much money they should have. The recipient is called the “beneficiary” (s). You also need to decide if the payout should be made as a lump sum or a fixed monthly payment.
If you create life insurance without a deduction, do not take into account taxation. Thus, without deduction, your survivors will not have to pay tax on the payment.
If, on the other hand, you choose to set up your life insurance with a tax deduction, then income tax must be paid on payment. All that you agree with your insurance company when you create the insurance.
Do I already have life insurance?
Life insurance is often taken out through a pension company, a union, or the workplace. It may well be that you already have life insurance. You can find more information at pensionsinfo.dk and see if you may already have life insurance.
What amount do my relatives receive from my life insurance?
Policy.com provides information about your pension and can also calculate the amount that goes to your next of kin in the event of death. Similarly, pensionsinfo.dk can calculate what amount you are covered in case of illness. We recommend everyone to log into pensionsinfo.dk to get an overview of their pension and to find out how they are covered in case of illness and death.