Relevant Life Plans

Within any business, there are key individuals who are essential to the success and operation of the organisation, such as Company Directors, High Earners, Salespeople, and other key employees. It’s vital to protect these invaluable assets, and a Relevant Life Plan is an ideal solution. At Teesside Money, we have the experience and market access to help you find the best Relevant Life Insurance policies tailored to your key staff.

What is a Relevant Life Plan?

A Relevant Life Plan is a tax-efficient alternative to a traditional ‘death in service’ benefit. It allows a business to provide a lump sum payment to the family of a key employee in the event of their death while employed by your business, or if they are diagnosed with a terminal illness. This kind of business protection insurance can save businesses almost 50% in tax compared to a standard life insurance policy.

This solution is particularly useful for small businesses that are unable to set up a costly group scheme. It provides an affordable way to offer valuable benefits to your employees.

For Company Directors, a Relevant Life Plan provides a significant tax benefit. For other key employees, it allows you to tailor individual levels of cover, making it ideal if you want to reward a select few employees.

At Teesside Money, we believe a Relevant Life Policy is an excellent incentive that not only helps retain key employees but also attracts the best talent to your business.

How Does Relevant Life Insurance Work?

You’ve probably come across life cover policies before. A Relevant Life Plan works similarly, with the premium based on factors such as the individual’s salary, health, and living expenses. However, the key difference is that the business pays the premium rather than the employee. In the event of the insured employee’s death while employed by the company, the tax-free payout goes to their beneficiaries, rather than the business itself.

Benefits of a Relevant Life Plan

The benefits of a Relevant Life Plan are twofold:

• For the Business – It serves as a financial protection plan and is an effective, tax-efficient alternative to a group life assurance scheme, especially for smaller businesses. It enables Company Directors to secure cover through their business rather than their personal income. Additionally, it acts as a valuable HR tool, attracting top talent and fostering employee loyalty.
• For Employees – From the employee’s perspective, a Relevant Life Policy is a significant perk. They benefit from life cover without the burden of paying premiums themselves, providing peace of mind that their family will be financially protected in the event of their death. It plays a crucial role in family protection, ensuring employees’ families are supported should the worst happen.

In a nutshell, even if you are a sole director of a limited company you ca have a life insurance policy that you pay out of the company account. This is not only a tax deductible expense but you benefit twice over as you do not have to pay for your life cover out of your personal bank account. The beneficiaries can be your family the same as any other life policy.

If you are an employer and have a number of employees you would be able to provide a benefit for your staff. You would pay for the plan which again is tax deductible and your staff member would have a free of charge plan that would pay out in the event of death to their chosen beneficiary

Additionally, if you are looking for specialist lending options to further secure your business or investment goals, we can also offer expert advice and access to the best financial products tailored to your needs.