By recommending Life Cover and putting it in trust, your clients can avoid a delay in benefits being paid out which may help them mitigate any inheritance tax liability.
You’re likely to have clients who don’t believe they need protection - this may be for a variety of reasons. But protection can help with inheritance planning as well as help underpin their wealth by providing cover at a potential time of need.
Using a menu approach to protection, you can add value to your wealthier clients…
As an example, a couple has built up an estate worth £750,000. They’ve a grown up son and one grandchild. They’re unaware though that their son would face an immediate tax bill upon inheriting the legacy they’ve worked so hard to build.
In this scenario the son’s inheritance tax bill would be £170,000* on the second death. This along with any funeral costs would be payable immediately. Without the right advice, it’s very possible that their son would struggle to fulfil his tax obligations before gaining access to the inheritance.
However, by having some Life Cover that’s written in trust, this gives the son immediate access to the funds he’d need to meet his tax obligation and to meet any outstanding liabilities.
Alternatively our couple could also add some Critical Illness Cover or Income Protection to their plan. This would provide funds in the event of a serious illness or injury - helping them to avoid liquidating their assets or changing any long-term investment plans. This could help cover any short-term financial commitments they may have, such as helping with nursery costs for their grandchild.
These are obviously just suggestions - you can create your own package from any of our covers, tailoring them to suit your client’s needs and budget. Get a quote now.
This makes the process of putting plans in trust quicker, more secure and ensures that the trust is completed correctly.
We’ve a wide range of bare and discretionary trusts available to meet your clients’ needs, you can even go back retrospectively and place a plan in trust at a later date.
* This example is for illustration purposes and does not represent actual customers. It's based on the 2017/18 inheritance tax nil rate band of £325,000.