What is Relevant Life Insurance?
Relevant Life Insurance is policy which enables your employees to leave a financial legacy to their loved ones. The lump sum could pay out in the event of death or terminal illness with the proceeds normally being tax-free. The cover is commonly described as a “Death in Service” benefit. As such, the premium is paid for by the Business, not the employee.
How does Relevant Life cover benefit the Business?
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This type of cover is often seen as an employee benefit which may help when trying to attract/retain employees.
- The premiums may be classed as tax-deductible.
How does Relevant Life cover benefit the Employee?
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The employee’s family are normally the beneficiary of the policy meaning they are provided for financially in the event of a claim.
- The premiums are not classed as a P11D benefit.
- The proceeds of a claim are not usually subject to Inheritance Tax. They also don’t normally impact an employee’s “Lifetime Allowance”.
What else do I need to know?
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The premium is paid for by the Business, not the employee.
- The cover is designed for small and medium-sized businesses as the medical underwriting must be completed with each employee covered.
- All employees and company directors are eligible providing they are registered under PAYE.