A guide to Relevant Life Cover
Relevant Life Cover in an insurance policy that allows companies to offer a death-in-service benefit to its employees (including salaried directors) in a tax efficient way. Once set up by the company, the relevant life cover policy will pay out a tax-free, lump sum on the death (or diagnosis of a terminal illness) of the person insured. The employee’s family or financial dependents receive all of the proceeds.
Relevant life cover features
- Counts as a tax-deductible business expense
- Monthly premiums
- Premiums are guaranteed
- Benefits are normally free from inheritance tax
- Maximum amount of cover is capped at £10million
- Must be written into a discretionary trust
- There is no cash value at any time
- If your client stops paying their premiums, the related cover may end
- Once the plan has been issued, it cannot be changed
- Claims will not be paid if the person covered dies as a result of intentionally taking their own life within the first 12 months of the policy
Who Relevant Life Cover might benefit
- Businesses that are too small for a group life scheme
- Employees who might exceed their personal pension lifetime allowance.
- Members of group life schemes who want to top up their benefits as some group life schemes can be restrictive.
The person covered must be a UK resident and an employee of a UK business and cover must stop by age 75.
Relevant Life Cover is not available to sole traders or partnership companies and must be written in a discretionary trust.
Meet our experts...
We have a great team of qualified and tallented people over our 8 offices.
Meet our agiculture specialists below. View our whole team section to meet the whole Albert Goodman range of experts.
Latest case studies
Somerset Motorhomes Centre and Albert Goodman
Ian Dance Services and Albert Goodman
PizzaRova and Albert Goodman
Halstock England and Albert Goodman
Martock F.I.T- Client Case Study
Classic Canes- Client Case Study
Giving grandchildren a worry-free education
Insuring against Inheritance tax
Care with peace of mind
Keeping it in the family
Get started today
Contact us today and speak to our expert team to get started