Relevant life plan for peace of mind
A Relevant Life Plan is a life insurance plan taken out by an employer on the employee’s behalf, to provide an individual death-in-service benefit for their employees.
What is a relevant life plan?
This insurance product pays a lump sum to the employee’s family if the employee dies when employed, while the plan is in place. Terminal Illness Cover is included, which could pay out if the employee, whilst employed and covered by the plan, is diagnosed with a terminal illness, with life expectancy of less than 12 months. Premiums are paid, and the policy is owned by the employer.
How does relevant life plan work?
Relevant Life Plans can be particularly beneficial for small businesses that don’t have enough eligible employees to warrant a group life scheme. They can also be attractive for high-earning employees or directors who have substantial pension funds and don’t want their benefits to form part of their lifetime allowance, and for members of group life schemes who want to top up their benefits.
It can be arranged to provide a lump sum if the employee dies or is diagnosed with a terminal illness.
What are the benefits of relevant life insurance?
Offer affordable life insurance to employees
Relevant life insurance is a way to offer affordable life insurance with coverage for terminal illness to employees.
Appealing policy for potential and current employees
Offering a suitable life insurance policy as part of the benefits given by your company can make it more appealing to potential employees. It can also assist in keeping and rewarding current employees, while indicating that you are a responsible and caring employer.
Cost-effective way to provide a benefit to employees
Relevant life insurance can also help employers pay less tax, so it can be a cheaper way for smaller companies to provide similar benefits as bigger companies when trying to attract employees.
Tax deductable
Premiums are often considered a cost of doing business and can be deducted from taxes. If you keep the plan in trust, it can help you prepare for inheritance tax if the value of your assets is expected to exceed the current threshold for inheritance tax.