A relevant life insurance policy enables employers to provide individual death-in-service benefits for their UK-resident employees who are aged 17 – 71 when the policy is established. The policy, which is applied for and paid for by the employer, pays out a tax-free lump sum if the insured employee dies — or is diagnosed with a terminal illness — whilst in the service of the employer.
Relevant life plans are, however, available only where an employer-to-employee relationship exists — i.e., employees of a limited company. For that reason, relevant life insurance is not available to sole traders, a partnership’s equity partners, or equity members of a Limited Liability Partnership
Employees can use a relevant life policy to provide their own individual ‘death in service’ benefits in addition to those offered by their employer’s group life insurance scheme if such a scheme exists. The premiums paid to a relevant life policy and the benefits paid out, are not included in the employee’s annual or lifetime pension allowances. (Relevant life is a term insurance, so the policy has no surrender value.)
The policy’s sum assured is based on a multiple of the employee’s total remuneration, which...
Employer: Providing Her Majesty’s Revenue & Customs agrees that the premiums paid are...
To ensure the proceeds go directly to the employee's family or financial dependants, we will...
If the policy is portable, the employee can take it with them should they move to...
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