Life Insurance - putting in trust

BB1984

Hi there, hope someone can help as I have a query that I'd like answered before I phone up the life insurance company!

I've read Martin's guide on here, and used Cavendish to find a policy that suited our requirements. Martin recommends that the policy is "put in trust" to each other (joint policy, husband and wife). Fine by me, but I can't find any way of doing this online - not on Cavendish's form or on Aviva (our chosen policy provider).

Does anyone know how to do this online?

Obviously I will phone them if needs be, but I struggle to find time whilst at work(!) to make phone calls which always end up taking ages due to being left on hold etc....! Also I want to make sure I benefit from the cheaper online rate.

Thanks very much.

BB

dunstonh

Martin recommends that the policy is "put in trust" to each other (joint policy, husband and wife).

Who are you going to put the policy in trust to? (assuming you are setting it up joint life first death, joint owner basis)

Does anyone know how to do this online?

You choose the type of trust you want (there are more than one) or you get a solicitor to write up a specific trust if one of the off the shelf versions doesnt fit your needs. Once you know the type of trust you want, Aviva can supply the forms. It should ideally be done at point of application.

BB1984

dunstonh wrote: »

Who are you going to put the policy in trust to? (assuming you are setting it up joint life first death, joint owner basis)


You choose the type of trust you want (there are more than one) or you get a solicitor to write up a specific trust if one of the off the shelf versions doesnt fit your needs. Once you know the type of trust you want, Aviva can supply the forms. It should ideally be done at point of application.

Thanks.

Well my understanding was that we needed to put it in trust to each other, so that if I die, he gets the money without having to pay any inheritance tax etc....? And vice versa. Are you saying that on a joint policy, this is automatically the case?

Also, we don't have any children at the moment, but if we do in future then I guess it would need to be written in trust to them in the event that we both died at the same time.

Cheers,

BB

dunstonh

Well my understanding was that we needed to put it in trust to each other, so that if I die, he gets the money without having to pay any inheritance tax etc....?

Putting it in trust can avoid inheritance tax but putting each spouse down negates that as there is no IHT applicable then. Also, if its joint life, joint owner and you are unmarried then it doesnt matter. If its single owner then it can do.

Its a risk when you follow Martin's articles as "advice" as there are some errors or more often a simplification in some which wont apply to some people.

Are you saying that on a joint policy, this is automatically the case?

There is no IHT payable between spouses. Its second death when IHT is potentially liable.

Also, we don't have any children at the moment, but if we do in future then I guess it would need to be written in trust to them in the event that we both died at the same time.

Yes. its the second death that matters (ignore death at same time as that isnt really how it works on paper) and the children could be used in the trust to avoid potential IHT.

BB1984

That's great, I really appreciate your help.

We are married so no need to write in trust then. We'll deal with the kids as and when they happen!

Cheers
BB