How does this policy work?
The effect of a premature death is devastating to the family concerned and your workplace. By ensuring your employees are covered by a Group Life policy, things are taken care of without neglecting the needs of your business.
Group Life cover pays out a lump sum to an employee’s partner and/or their dependants’ as a pension benefit in the event of their death.
For more information on how the policy works, please refer to the Group Life Technical Guide.
- You choose the options that suit your business
- Our flexible options will help meet your needs and budget.
- You decide the level of benefits provided, for example you could set a higher level of cover for Directors or senior staff, based on a lump sum or a fixed multiple of the employee’s salary.
- If you decide to include dependants or children’s pension to the Group Life policy, it will mean that they will receive a pension, based on the employee’s existing pension or salary.
- Above our free cover limit (up to a maximum of £1,800,000 total sum assured) we can make sure that medical underwriting takes place just once, avoiding any ongoing intrusion or administration for you.
- You can rely on us for support if a claim is made
- We’ll pay the agreed sum to the scheme’s Trustees in the event of a death.
- Lump sums do not usually form part of the deceased’s estate, so they are normally free of inheritance tax, which means that they can be paid immediately to help families cope with a difficult period of transition.
- Under current legislation lump sums are usually tax-free, but beneficiaries may be liable for a ‘Lifetime Allowance Charge’, if the payment (when aggregated with the value of benefits that the member has taken from other Registered Pension Schemes) exceeds the member’s Lifetime Allowance - for more information, please contact us.
- We’ll provide expert guidance and support through our bereavement helpline for as long as necessary to help your employees and their families cope with loss.
- Pension benefit can normally paid direct to the member’s dependants, pension payments have tax deducted as earned income, in accordance with HM Revenue & Customs requirements.
- Group Life cover premiums are usually treated as an allowable business expense for tax purposes.
Tax rules can change in the future.
If there’s anything else you’d like to know about how this policy works, or if there’s anything that you’d like us to explain in more detail, don’t hesitate to contact us.