Trusts can often be a vital addition to you policy. If deemed appropriate, we will write your policy into a trust free of charge. If your policy is not written into a trust, and you have no will in place, any proceeds will follow the rules of intestacy.
The three main advantages of writing your life insurance into trust are as follows:
1) Potential avoidance of inheritance tax – it can ensure that the proceeds of the plan are ring fenced outside your estate, improving the value of any payout as inheritance tax is charged at 40% on anything above your nil band rate.
2) Speed – as a trust is deemed a gift during your life time, proceeds will not enter your estate, and therefore not have to go through the probate process – which can take up to a year. Proceeds of a claim can be paid within weeks ensuring the money is available for your family’s financial needs.
3) Specified beneficiaries – the beneficiaries of the plan will be named on the trust document, so you can be sure the right people will receive any proceeds, and confusion around the probate process will be avoided.
Any critical illness claims will be paid to the policy holder, with any claims on the life insurance element being paid to the trustees.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
The Financial Conduct Authority does not regulate trusts.