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How Relevant Is Your Life Cover 119 L

How Relevant is Your Life Cover?

Every individual wants to have the assurance of how well their loved ones and family will be taken care of after they must have died; however, what does a Relevant Life Policy mean and what are the differences between it and other kinds of Life cover plans?

We are going to consider many aspects of this well known method of protection.

What is Relevant Life Cover?

It is a life insurance policy that takes care of the directors and/or employee of a company by paying out large sum of money in case of the diagnosis of terminal illness or death of the individual. The main difference between this policy and the standard life insurance policy lies in that the company is responsible for payment of premium and it can also benefit from taxable expenses being avoided.

Who gains from it?

Based on the way the policy is designed, individuals are paid instead of company and the employer is the owner of the policy. However, the individual and their family gain from it as the beneficiaries.

How much Relevant Life cover does each individual need?

It is important to understand how much you will need to cover. With the aid of salary multiples, many companies will protect their employees. An individual earning £40,000 each year, for instance, with 10 years of service left before retirement could likely cover for £400,000, which is 10 folds of the current yearly take-home salary.

Based on age and income, the insurers also have the power of setting limits on how much to cover. For instance, there is no need for a 55-year-old that currently earns £25,000 each year to get a policy that will amount to cover worth millions of pound.

Are self-employed sole traders eligible for this insurance policy?

Without mincing words, they are not eligible. It is only when an employer-employee relationship exists that this policy can be used and the person under the policy must be receiving salary from the company. Other limitations to the use of relevant life policies are:

  • Money can only be paid out under this policy if the person is dead under the age of 75
  • It only covers when the person is dead; hence, it offers no benefits in case of critical illness
  • Though the employee can decide who the beneficiaries are, the trustees have absolute control over how and where the pension will be paid

Apart from the aforementioned limitations, there are also others attached to this policy; therefore, individuals must receive financial advice before deciding what to do.

With us at Specialists4Protection, the whole marketplace is given critical analysis in order to ensure the most suitable type and level of cover are selected by you. To speak to any of our highly trained consultants, call on 01243 219190 or send email to This email address is being protected from spambots. You need JavaScript enabled to view it.

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Quotes shown are for a 40 year old male who doesn’t smoke. Policy is £100,000 life insurance cover for ten years with a fixed premium. Example is for illustrative purposes only and was correct on 21/11/2016.

FREE impartial advice from the experts

  • Life Insurance

    The most common form of protection, ordinary term life cover pays a lump sum to your family if you die within a certain time-frame. Most policies will also pay-out if you’re diagnosed with a terminal illness and have less than twelve months to live

  • Critical Illness Cover

    Critical Illness Cover provides a cash lump sum if you suffer from a range of serious conditions within a set time-frame. The money is normally used to pay the bills and provide financial security while you’re on the road back to health

  • Income Protection

    If something serious happens to stop you working - for months, years, or even for life – you’ll want to know you have financial security and that the bills are paid. Income Protection gives you just that, paying a percentage of your income all the time you’re unable to work.

  • Private Health Insurance

    The NHS is groaning under the weight of the UK obesity crisis and newer, more effective medical treatments for a range of illnesses often aren’t available. Private medical cover makes ‘going private’ much more affordable – giving you access to more treatments, shorter waiting lists, and first-class care.

  • Relevant Life Cover

    Most company directors are savvy enough to have life insurance, but very few realise they can save up to 53% by taking advantage of a Relevant Life plan.

  • Group Life & Health

    Group Life and / or Health Cover is the most cost-effective way to provide peace of mind and financial security for the families of your employees.

  • Key Man Cover

    Key Person Insurance - often called Key Man Cover - is an insurance policy bought and owned by a business to protect its own interests. Cover is provided in the event that an important staff member is suddenly unable to work through critical illness and/or death.

  • Shareholder Protection

    Shareholder Protection Insurance is designed to give you peace of mind in the event that a shareholder in a Limited Liability Company, a member of a Limited Liability Partnership (LLP), or a partner in a partnership dies or is diagnosed as critically ill.


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