It is terrible when a loved one dies. Equally terrible, however, are disputes over inheritance: siblings who fight with lawyers, grandchildren who are enemies to the core. Many families in Germany fall out over money. The testator can prevent such dramas by observing a few basic rules when leaving an inheritance. For example, when bequeathing a life insurance policy.

Common inheritance mistakes

One major mistake: inaccuracies in the beneficiaries. Anyone who only writes "the heirs" or "the spouse" in the insurance contract and thinks that everything has been settled for the inheritance is mistaken. The statement "the heirs" in the contract means that all identified heirs would be entitled to the insurance benefit. It would be more accurate to speak of "legal heirs": Then only the persons who are also heirs according to the legal order of succession are entitled to benefits, i.e. parents, children and grandchildren.

Another frequent case of dispute: The policyholder remarries after a divorce and does not clearly state which spouse should receive the money. As a rule, the person who was married to the policyholder at the time the policy was taken out then receives the money.

Check inheritance regulations regularly

The beneficiary or beneficiaries should always be entered in the insurance policy with their name and date of birth. The testator should also regularly check whether the beneficiaries are still the right ones. Anyone who marries a second time after a divorce or wants to include the children of the new partner should have this noted in the contract - written notification to the insurer is sufficient.

Excluding children or spouses from inheritance

Inheritance law generally distinguishes between revocable and irrevocable beneficiaries. The irrevocable beneficiary is always entitled to the insurance benefit. This entitlement cannot be revoked against his will, but only with his express consent. With an irrevocable subscription right, the money is safe from the insolvency administrator even in the event of the policyholder's personal insolvency.

More often, however, the revocable subscription right is chosen in wills - so the insured person can change the beneficiaries as often as they wish. This means that children can be removed from the inheritance in the same way as spouses. The wording "legitimate children" in the contract guarantees that only the insured person's own children will benefit from the inheritance. A revocable subscription right can be changed to an irrevocable right at any time.

Policyholders should also cross-insure with a desired beneficiary - this can save taxes on inheritance. For example, if the husband takes out life insurance on the wife's life, he is the beneficiary in the event of death and receives the previously agreed capital payment. The wife does the same and insures her husband's life. In the event of his death, she receives the money. The money paid out in this way is free of inheritance tax. However, the other person must agree to this arrangement.

Problem case: Inheriting real estate

Inheriting real estate always causes problems. A house or condominium cannot just be bequeathed to the eldest child - all siblings are entitled to their compulsory portion. The designated heir would therefore have to pay out the others. It is also difficult to leave a property to a spouse alone if the testator does not also have sufficient funds to meet the children's claims.

The simplest solution for married couples is the so-called Berlin will - a joint will in which the spouses appoint each other as sole heirs. Without a will, a property is included in the estate, which is distributed equally to all heirs in accordance with the statutory order of succession. Example: A house belongs to both spouses in equal shares. In the event of death, the partner and two children are left behind. The partner receives half of the half to be inherited, i.e. three quarters. The other quarter is divided between the children. The surviving dependants form a community of heirs who have to make every decision together - be it renting, selling or even renovating. A situation that can quickly lead to trouble.

This can be prevented by a so-called division order in the will. The prerequisite for this is that there are other assets in addition to the house, such as securities. It must then be determined exactly who gets what in the event of an inheritance. The partner the house and the children the shares, for example. All parts must have the same value.