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TRUSTS
Benefit from placing your policy in a Trust.
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The benefits are huge and so are potential pitfalls from not writting in trust.
So what does writing your policy in trust mean?
Normally when a life insurance claim is made, the sum assured will be paid into the plan owners estate. Once the money reaches the estate it is subject to Inheritance Tax and to the time it takes for probate to organise and redistribute the deceased's property.
Probate itself can take many months even for a straight forward case and if the Life Insurance is allowed to be subject to it, no benefit would be seen for many months.
By having your policy written in trust, the payout from the Life Insurance is prevented from entering the estate and is instead paid to whoever you nominate. As a result the cash would be paid out much faster and would not be subject to inheritance tax.
Talk to us about placing your policy in trust.
Having your Life Insurance policy written in to trust is one of the most important steps you should take when setting up your Life Insurance but is sadly forgotten by a vast number of people.
The FSA does not regulate some forms of Inheritance Tax Planning.