2 Life Insurance questions please

kunash

my aunt had a life insurance policy, which was in trust, she passed away march 2008, the sum was paid out straight away. it was taken out in 2004.

initially i thought the amount paid would be covered under the 7 year rule, ie IHT would be payable on it, on sliding scale.

i passed this information on to the solicitors who are joint executors. my aunts tax bill is about 400,000. the solicitors have asked was the life insurance policy a 'discretionary trust' one? ( ie, if it was then it would not form part of my aunts estate ). I phoned the life ins. people and asked this, but all they said was the policy would be covered under the 7 year rule. all the paperwork to do with the policy has been returned to the insurance people now. if it was discretionary would it flash up on their screen as being so? how would you make the policy discretionary at the time of signing it?

edit: i phoned the insurance people again and they say the policy was in a discretionary trust but does form part of the estate, so I will leave the solicitors to work that out.



my second question. I am 40, i am about to take out life insurance for the purposes of paying IHT if I die. I have requested my medical records so i can accuratley disclose to the insurance people my past and current health. i am unmarried, and no children.

i am looking to try and initially take out cover for 300,000. i could either do whole of life ( premiums would be higher for this ) or for a set amount of years, up to 85.

would it be adviseable to get cover up to 85, so a fixed yearly term of 45 years? or cover for 15 years which will take me to 55? i have no way of telling what my health will be like at 55 so not sure if i would be accepted to get cover from 55+.

i know for a fact on my medical records i have mentioned cocaine, this will increase premiums ( this was about 5 or 6 years ago ).

as long as i am truthful about my current and past medical history, then if i die of say, a cocaine related illness ( whatever that is ?? - just an example ), then i would be still covered, and the policy will pay out, correct?

so just wondering what term i should go for? i know it is hard to reply to that question, but i really cant see myself living to 80, with my past lifestyle, but then who knows?? Only him upstairs knows that

*MF*

Hi .. my experience in these areas was once thorough, but it is no longer up to date, so I hesitate to give you any definitive answers - just wish i could.

I also don't like (altho very new here) to see valid questions asked - and no response forthcoming.

So .. what I can suggest is that there are IFA's (and others) who specialise in these areas, and were I you that would be my first port of call - the questions you ask are not answered simply, it needs more than anything a full understanding of your position, then a meeting to let you have experienced comment with options and costs, and perhaps this forum may provide some of that - I have seen some excellent posts - but I still feel it may limit the advice you are given.

Hope this helps - even a little, ok.

poppy_f1

cant help with the first question but when i applied for life insurance they got a GP report for me and it disclosed drug use in my younger years, they got me to fill a questionaire in saying what i had taken and how frequent but they never made me pay anymore

kunash

hi, thanks for the replies, i will be going through Endsleigh, i have phoned them and they seem knowledgeable and helpful, just waiting for my medical records then will go from there

khoobsort

Hi
I am also going to apply for a life insurance policy to cover my mortgage.

How and to whom I should apply to get my medical record?

I used to take inhaler for asthma but I am fine now and have not taken any asthma medicine for 4 years. Do I still need to mention Asthma?

I also had taken medicine for depression about 10 years before. Will they still count? What should or should not I disclose?

Thanks.
Khoobsort

dunstonh

How and to whom I should apply to get my medical record?

Your doctor. Expect to pay for it.

used to take inhaler for asthma but I am fine now and have not taken any asthma medicine for 4 years. Do I still need to mention Asthma?

Yes.

I also had taken medicine for depression about 10 years before. Will they still count? What should or should not I disclose?

Possibly depending on the provider and the questions they ask.

khoobsort

Thanks

Khoobsort

khoobsort

Thanks

Khoobsort

nspnick

Hi. You should always disclose. They do have a cover all question on the proposal which usually asks if there is anything else which may be relevant. Best to be up front than have problems on any claim. This is also why it is worth looking at claims history of life company. Some such as BUPA, friends prov, and NU have good record at paying out. Others such as the supermarkets and newer life companies will not have a track record.

dunstonh

Is it true that life insurance policies have come down in recent years?

Depends on what you mean by recent. 4-5 years ago the prices bottomed out but have been rising since then albeit by small amounts. Historically, they are far cheaper than 10 years ago but not 5.

ALWAYS read the small print and always be honest on the policy application abuot your health - otherwise you may end up paying for a policy that they will refuse to pay-out on!

Its also worth noting that not all policies are the same. Some have guaranteed insurability options and addons that others do not. A common mistake by those going DIY is to get a lower quality policy than the one they already have.