The whole point of us looking at protection, particularly Life Insurance, is to ensure our loved ones do not financially struggle when we pass away. Once a Life Insurance policy is started, it’s highly advisable to make sure you have a Trust set up. Without a Trust, the money paid out from your Life Insurance policy will end up in your estate.
Your estate is like a big pot where all your worldly belongings are stored when you pass. This can include pensions, cash in the bank, investments, equity in property, vehicles owned and Life Insurance policies. If the value of your estate exceeds £325,000, there will be a 40% inheritance tax your next of kin must pay before anything can be released from your estate (for the 1st death in a marriage this is exempt).
In addition to this, your next of kin will have to go through the probate process which can take months, even years to complete. Until this has all been done, the money in the estate (including any money paid into the estate from a life insurance policy) is literally trapped.
The trust, which we will set up for free, is like having a separate pot for the Life Insurance policy to be paid into. So, on death, the money is paid into the trust instead of the estate which means there will be no inheritance liability or long, drawn-out probate process.
Even though you may have a Will in place, which is important, it will have no effect on the Life Insurance policy paying into the estate. This is because, in a nutshell, the money from the Life Insurance policy doesn’t exist yet. It is not possible to put something that doesn’t exist into a Will. As a result, without a Trust, the money will end up in your estate by default.
There are numerous types of Trusts for various personal and business protection products. One thing you can rely on is that we will set the right Trust up for you as part and parcel of the service we provide. We also have a dedicated Trust team who will guide you through should you have any questions or concerns.
If, like many of our existing customers, you want to make sure you’ve got the best cover without paying an absolute fortune, you will benefit from speaking to one of our Protection Experts. They will talk you through what’s available and ensure you get a plan that’s best suited to your needs and budget.
Unlike Mortgage Advisers and many other Insurance Brokers, we work across the market to make sure you get the best possible cover to fit within your budget. We’ll ask you about your health, lifestyle and occupation before you apply for your cover so there are no nasty surprises later on. What’s more is that we charge no fees at any point for anything we do.
Looking at Life Insurance really can be a minefield… How much Life Insurance do I need? Should I look at Critical Illness Cover? What’s the difference between Income Protection and Critical Illness Cover? What’s the best thing for me and my family? Let us answer all these questions and help you chose the right cover for your needs.
Our partner LifeSearch has won Protection Intermediary of the Year 10 times in the last 11 years, which speaks volumes about the level of service we offer our clients. We are here to help you so why not get in touch for your free, no obligation quote today?