Finding out about Aviva trusts


What is a trust?

A trust is a legal arrangement that lets the owner of something (such as your Aviva life insurance policy)’gift’ it to other people without giving them full control over it.

Why use an Aviva trust?

  • You, as the settlor can choose who you wish to receive the money from your life insurance policy – the beneficiaries
  • If it is necessary to make a claim under your policy, the trustees should receive the money quickly. Once the claim has been accepted, we’ll pay the money from your policy to the trustees, who will then pass it on to your beneficiaries, or look after it until the beneficiaries are old enough to deal with the money themselves
  • You will keep an element of control over your life insurance policy, as you’ll automatically become one of the trustees, as the settlor
  • Your life insurance policy usually won’t be counted as part of your estate when you die, meaning that the benefit of the policy may be exempt from inheritance tax*

Please be aware that Aviva trusts are not currently available for Free Parent Life Cover customers.

*Liability for tax will be dependent on your personal circumstances and tax rules that may change. If you are concerned about you or your estate’s liability for tax, please consult a professional advisor.

Who is needed to set up a trust?

Settlor – this is the legal name for the person who sets up the trust and transfers their policy into it. You, as the settlor needs to think about who you want to benefit from the money (the beneficiaries), and who would look after it if you were to die during the policy term (the trustees).

Trustees – the settlor passes the legal ownership of the trust to the trustees. They are legally bound to look after it in line with the terms of the trust for the people who’ll ultimately benefit from it.

If you were to put your life insurance policy under an Aviva trust, you will be the settlor. You will also automatically be a trustee. We recommend that you appoint at least one other trustee to help you look after the trust.

Beneficiaries - the beneficiaries are the people who will receive the benefits from the trust. In an Aviva Discretionary Gift Trust, this means the payment from your life insurance policy.

We would not deal directly with the beneficiaries of the trust, because it is the trustees who legally own the life insurance policy that forms the trust property. Instead, we’ll deal with the trustees on behalf of the beneficiaries.

What types of trust do Aviva offer?

There are two types of trust that Aviva provides;

Aviva Discretionary Gift Trust (Protection)

This is a very flexible trust, which allows you to choose from a wide range of beneficiaries including your children and grandchildren. This trust even allows you to choose children or grandchildren who are born after the trust is set up.

If your circumstances change, you may be able to agree with the trustees to change the beneficiaries of the trust. Trustees should ideally be told in writing how you’d like the money from your policy to be divided amongst the beneficiaries. You can change your mind at a later date if you want to.

Aviva Survivor Trust

This type of trust could be more suitable if your life insurance policy covers two people. It is common for couples to have a policy that covers both people and pays the surviving partner if one dies. This type of policy can cause problems in some instances:

  • If both partners die at the same time – if this were to occur the money is paid to the younger partner’s personal representatives, which is then part of their estate for inheritance tax. There is also likely to be a delay before the beneficiaries of their estate receive the money, and they also may have to pay inheritance tax on it.
  • If the surviving partner dies very soon after their partner – if this occurs the money is paid to the personal representatives of the second of the two to die. Again this means the money will be part of that person’s estate, the beneficiaries then may have to wait to receive the money and they also may have to pay inheritance tax on it.

The Aviva Survivor Trust helps in both of these instances. By putting your joint life insurance policy in this trust, the trustees can pay the money to the surviving partner as long as they’re still alive 31 days after the death of their partner.

If the surviving partner dies within 31 days of the other partner, the trustees can pay the money from the plan to the beneficiaries of the trust (usually the children of the policyholders). They usually won’t have to pay inheritance tax on the money as part of either partner’s estate.

Can you recommend a trust for me?

Aviva are a non-advisory company and as each individual’s needs are different, we cannot make recommendations on which trust is for you. If you're unsure on any of the above you should seek independent legal and financial advice. This is because:

  • There are tax and legal consequences when you set up a trust
  • A trust cannot be cancelled once it is set up
  • The trustees have a special duty to beneficiaries and will be personally liable for any loss the beneficiary may suffer if they use their powers wrongly

Where can I find more information?

We want you to be confident in any decisions you make. If you need more help and want to talk to a specialist such as a Financial Adviser or solicitor then you may find these links helpful or

Whether or not a trust is appropriate for you is dependent on your circumstances. You must make sure the trust you choose meets your needs, and should seek professional legal, tax and financial advice if you have any doubts.

How do I apply?

Please note that many different types of trust are available and the trust forms offered for download by Aviva may not be the appropriate trust for your circumstances.

It is important that you seek legal and financial advice when considering placing your policy in trust. If you would like to use one of Aviva’s trust forms, please download the form and discuss it with your professional advisers if you have any questions about whether or not the trust is right for you.

Return completed forms to:

Aviva BCC
PO Box 520

Aviva Discretionary Gift Trust (Protection) Application Form (PDF 625KB)

Aviva Survivor Trust Application Form (PDF 622KB)

Please bear in mind tax rules may change in the future and references to tax treatment of trusts are based on Aviva’s understanding of UK law and HMRC practice. Both of these may change from time to time, and Aviva’s interpretation may be subject to challenge by HMRC or other regulatory bodies. Neither Aviva nor its representatives can accept responsibility for any decisions or actions taken as a result of any information given.

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If you have any questions, queries, or you’d just like to know more about our life insurance plans, get in touch with us and we’ll be happy to help.

Call us on 0800 068 6800

Monday to Friday 8.00am – 8.00pm
Saturday 9.00am – 5.00pm
Sunday 10.00am – 4.00pm

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