Relevant Life Insurance
Tax-efficient life cover for directors and employees
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Relevant Life Insurance
Relevant life insurance can be a useful way for a business to provide individual life cover for a director or employee, with the policy usually paid for by the company. It is often used by limited company directors, small business owners and employers who want to offer valuable protection without setting up a full group life insurance scheme. If the person covered dies during the policy term, the policy can pay out a lump sum to their chosen beneficiaries, helping to support their family at a very difficult time. For many businesses, relevant life insurance sits alongside other protection options such as business life insurance and group life insurance, creating a more complete approach to looking after key people, employees and their families.
What Is Relevant Life Insurance?
Relevant life insurance is a life insurance policy taken out and paid for by a business for the benefit of an individual employee or director. The payout is usually made to the employee’s family or beneficiaries through a trust, rather than being paid directly to the company. This is different from some forms of business life insurance, where the aim may be to protect the company itself if a key person, shareholder or director passes away. It is also different from group life insurance, which normally covers multiple employees under one scheme. Relevant life cover is often chosen by smaller businesses because it can offer personal-style life protection for one person, without needing a larger staff-wide policy.
Why You May Need Relevant Life Insurance
• It can provide valuable life cover for a director or employee, paid for by the business.
• It may offer a tax-efficient way to protect a family, depending on the company and policy structure.
• It can be useful for small businesses that do not have enough employees for a full group life insurance scheme.
• It can help limited company directors put life cover in place through the business rather than personally.
• It can support employee benefits and help show key people they are valued.
• It can provide a lump sum to loved ones if the person covered dies during the policy term.
• It can sit alongside business life insurance to help protect both the individual’s family and the company’s wider financial position.
How EHF can help you with Relevant Life Insurance
Choosing the right protection can be confusing, especially when comparing relevant life insurance, group life insurance and business life insurance. Each type of cover serves a different purpose, so it is important to understand who the policy is designed to protect, who pays for it and who receives the payout.
EHF Mortgages can talk you through the options in plain English and help you decide which route may be suitable for your business. Whether you are a company director looking for life cover through your limited company, an employer wanting to improve staff benefits, or a business owner reviewing wider protection, we can help you explore the right cover for your circumstances.
We can also help with group income protection and business life insurance, giving you flexible options to protect your company, employees and key individuals.
Want to protect your family, your key people or your business? Speak to EHF Mortgages today about relevant life insurance and wider business protection options.
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