Relevant Life Policy
A Relevant Life Policy is a type of life insurance policy that provides financial protection to employees and their families in the event of the employee’s death. It is a single life policy that is taken out by the employer on behalf of the employee. The policy pays out a tax-free lump sum to the employee’s family or chosen beneficiaries in the event of the employee’s death.
Benefits of a Relevant Life Policy
- Tax Efficiency: Relevant Life Policies are a tax-efficient way for employers to offer life insurance benefits to their employees. Premiums paid by the employer are tax-deductible, and the policy proceeds are paid out tax-free to the employee’s family or beneficiaries.
- Flexibility: Relevant Life Policies are flexible and can be tailored to suit the needs of the employee. The policy can be set up to cover a specific term, and the amount of cover can be adjusted as required.
- Lower Premiums: Relevant Life Policies typically have lower premiums than traditional group life insurance policies. This is because they are not subject to the same Insurance Premium Tax (IPT) that applies to group life insurance policies.
- Employee Retention: Offering a Relevant Life Policy as an employee benefit can help to retain and attract talent to the company. It shows that the employer cares about the welfare of their employees and their families.
Why do you need a Relevant Life Policy?
As an employer, offering a Relevant Life Policy to your employees can provide financial protection to their families in the event of their death. It is also a tax-efficient way to provide life insurance benefits to your employees. A Relevant Life Policy can help to retain and attract talent to the company, and it shows that the employer cares about the welfare of their employees and their families.
If you are interested in learning more about Relevant Life Policies and how they can benefit your business, please contact the SMH Financial Services team on info@smh.group or 0114 266 4432.
Financial protection policies typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse.