Life Assurance

Most of us have heard of Life Assurance and appreciate that it is a policy that pays out either a lump sum or a series of payments when you die. These payments are normally paid without the deduction of any personal income tax.

It is however worth considering that any proceeds from a life assurance will be added to the deceased’s estate. If this takes the overall estate above the nil band threshold for inheritance tax, this tax would be payable for any amounts in excess of the threshold. This can be avoided by placing the Life Assurance in Trust and therefore separating out these proceeds from the ‘estate’ and keeping them tax free.

The proceeds of a Life Assurance policy are commonly used to pay off a debt such as a mortgage or to provide an income for your dependents.

You pay regular premiums to a Life Assurance company for either a given time span, or in the case of Whole of Life Assurance, normally through to death.

Life Assurance policies can be combined with other forms of insurance, such as Critical Illness insurance so that you receive the lump sum if you are diagnosed with a specified critical illness or on death.

For more information about Life Assurance call us on 01276 517700 or email advice@professional-wealthcare.co.uk