Relevant Life

laptop

What is Zurich Relevant Life?

Relevant life cover offers a tax efficient way for an employer, usually a small business, to provide life cover for an employee. It is designed to help protect their family against the impact of their death or diagnosis with a terminal illness whilst they're employed.

Why Zurich Relevant Life?

Relevant life cover may be suitable if:

  • The employer has a small business without enough employees to set up a group life scheme.
  • The employer wants to provide death-in-service benefits to their employees that exceed those payable under the main company scheme.
  • The employees have substantial pension funds and don’t want their death-in-service benefits to form part of their pension lifetime allowance, or for premiums to impact their protection from the lifetime allowance.

We’ve built our relevant life protection in a way that lets the employer choose the cover their employee needs, and change it when their employees’ lives change.

Zurich Life Protection Platform

  • Summary of cover

    Relevant Life cover

    • No assessment of premiums on the employee as benefit in kind or otherwise
    • Premiums paid by the employer are usually viewed as an allowable business expense by HMRC
    • Premiums and any benefit paid are eligible for relief from;
      • Income tax
      • Corporation tax
      • National Insurance contributions

    • Benefits do not count towards the lifetime allowance for pension purposes
    • In most cases benefits are paid free of inheritance tax
    • Our policies are portable, should the employee leave their current employer they are able to continue the policy in their own name

    Whether or not your business clients currently have life assurance, now could be the perfect time to review their situation to see if a relevant life policy would be suitable.

    Choose the cover that’s right for your business client’s employees

    • Monthly or annual premiums
    • Guaranteed premiums (unless cover changes or increases)
    • Choice between level, decreasing or increasing cover
    • Increasing cover options of 3%, 5% or RPI
    • Choice of decreasing interest rate between 2% and 18% (at 2% intervals)
  • Details of cover

    Eligibility

    Who can take out the policy?

    The policy can only be taken out by the employer, who can be:

    • A sole trader with employees
    • A partnership
    • A limited liability partnership
    • A limited company
    • A charity

    Who can the policy cover?

    • One employee, including: company directors (including shareholding directors) and company officers
    • Minimum age at entry 16
    • Maximum age at entry 73
    • Maximum age at end of term 74
    • Minimum term 1 year
    • Maximum term 50 years
    • Minimum premium £5 a month or £50 a year
    • UK resident

    Included benefits

    Benefits Description
    Decreasing cover The employer can choose to have their employees cover reduce in line with their mortgage. They can choose a decreasing interest rate between 2-18% at 2% intervals. This can be adjusted at any time.
    Free life cover during underwriting Cover for up to £2,000,000 during underwriting.

    How much does this policy pay out?

    The maximum sum assured will be limited to the life assured’s total remuneration.

    Age Total remuneration
    Age 16-39 30 x total remuneration
    Age 40-49 20 x total remuneration
    Age 50 onwards 15 x total remuneration

    Remuneration can include salary, bonuses, benefits in kind and dividends earned.

    Trusts

    The policy can only be issued into a relevant life policy trust, which the employer will need to set up when they apply. The employee’s family or dependants can be beneficiaries.

  • Flexibility

    We’ve made it possible for you to make changes without having to go through underwriting and asking questions about health, or changes in personal circumstances.

    As an adviser you will have the ability to make changes to the relevant life policy. You can access this through our online adviser portal.

    Milestone benefit

    When significant events happen the milestone benefit can be used to increase the sum assured without answering any questions about the employees health. If your client uses the milestone benefit, their premiums will change.

    The significant events are:

    icon Mortgage

    Take out a mortgage or increase the mortgage they already have

    icon Marriage

    Get married or enter a civil partnership

    icon Separation

    Divorce, separate or dissolve a civil partnership

    icon Become a parent

    Starting a family

    icon Pay rise

    Get a pay rise of 10% or more

    The maximum increase that can be made to the benefit amount is the lower of the original sum assured or £200,000.

    This benefit must be used within 90 days of the significant life event and can only be used if the employee is 54 years old or younger.

    Policy changes requiring underwriting

    • Increase the sum assured
    • Increase the policy term
    • Review the premium if the employee previously smoked

    Policy changes not requiring underwriting

    • Reduce the sum assured
    • Reduce the policy term
    • Remove increasing cover
    • Change the rate on increasing cover
    • Increase/reduce interest rate on decreasing cover

    What if the employee stops working for the employer 

    Continue relevant life cover with a new employer

    The policy can remain in the relevant life policy trust when the employee starts a new job, providing the new employer agrees to take over responsibility for the policy and the trust. Terminal illness will continue to be provided but there must be no break in premiums between the old and new employer.

    Transfer ownership of the policy to the employee

    If the employee leaves the business and doesn’t move to a new employer, they can take over the policy and pay the premiums themselves. Terminal illness will not continue to be provided and there will also be tax implications. For more information, see the Relevant Life Policy: Technical Guide for Employers and Employees.

    Did you know...?

    Your client can make changes to their policy at specific points during the term.

    To find out more, take a look at our Flexibility of cover guide.
  • Additional support

    Zurich Support Services

    Zurich Support Services is so much more than just a counselling service. We understand that there are things going on at home that can affect the employee’s work-life, and also things that are going on at work that affect their personal life. Zurich Support Services aim to help them achieve a positive work-life balance.

    Talk to the team about anything at any time

    Your business client can talk to them about anything, from daily worries to major life events. Even if the team can’t help on the call, they can point them in the direction of someone who can. Here are just some of the things people pick up the phone to talk about:

    iconDaily worries

    • Looking for a job
    • Paying back debts
    • Managing household bills
    • Checking consumer rights

    iconBig life events

    • Planning a wedding
    • Facing separation or divorce
    • Dealing with bereavement or loss
    • Moving to a new house

    icon Emotional support

    • Coping with anxiety or depression
    • Living with illness or disability
    • Revisiting life goals
    • Asking about therapy

    iconWork

    • Dealing with pressure or stress
    • Balancing work with a private life
    • Facing bullying or harassment
    • Understanding employment rights

    Zurich Support Services are available 24 hours a day 365 days a year and can be used from the moment the policy is taken out.

    Find out more

  • Making a claim

    If your client needs to make a claim, or someone needs to make a claim for them, they’ll have their own dedicated claims specialist who’ll be with them every step of the way.

    For life cover claims

    Call us on: 0370 243 0827 

    Or email: Bereavements.zurich@uk.zurich.com


    For more information on making a claim, visit our claims page.

  • Reasons why paragraphs

    Below are a selection of reasons why paragraphs for you to use in letters to your clients.

    Why Zurich?

    We agreed that confidence in whoever is going to provide your protection solution is important to you. With this in mind, I’m able to provide some background information about Zurich which reflects their standing in the market.

    Zurich Protection provides you with range of ways to protect yourself and your family against the financial impact of death, critical illness or loss of income through illness or injury. Zurich have built their products in a way that lets you choose the level of protection you need, and change it when your life changes.

    Zurich is a leading insurer that serves its customers in global and local markets. With about 54,000 employees, it provides a wide range of general insurance and life insurance products and services in more than 210 countries and territories. Zurich’s customers include individuals, small businesses, and mid-sized and large companies, as well as multinational corporations.

    Relevant Life - Life level

    From our discussion I recommend you take out level relevant life cover of £< insert level of life cover here> over a term of <insert term> with Zurich, who will pay this amount as a lump sum if <your employee / name of life assured> dies during the policy’s term. Premiums and any benefit paid are eligible for relief from income tax, corporation tax and national insurance contributions. A lump sum will also be payable if they are diagnosed with a terminal illness, as defined in the policy terms and conditions the illness either has no known cure or has progressed to the point where it cannot be cured, and in the opinion of the attending consultant, the illness is expected to lead to death within 12 months.

    Relevant Life - Life increasing

    From our discussion I recommend you take out increasing relevant life cover of £<insert level of life cover here> over a term of <insert term> on a rate of <3%, 5%, in line with RP> with Zurich, who will pay this amount as a lump sum if <your employee / name of life assured> dies during the policy’s term. Premiums and any benefit paid are eligible for relief from income tax, corporation tax and national insurance contributions. A lump sum will also be payable if they are diagnosed with a terminal illness, as defined in the policy terms and conditions the illness either has no known cure or has progressed to the point where it cannot be cured, and in the opinion of the attending consultant, the illness is expected to lead to death within 12 months.

    Relevant Life - Life decreasing

    From our discussion I recommend you take out decreasing relevant life cover of £<insert level of life cover here> over a term of <insert term> on a rate of <2%, 4%, 6%, 8%, 10%, 12%, 14%, 16%, 18%> with Zurich, who will pay this amount as a lump sum if <your employee / name of life assured> dies during the policy’s term. Premiums and any benefit paid are eligible for relief from income tax, corporation tax and national insurance contributions. A lump sum will also be payable if they are diagnosed with a terminal illness, as defined in the policy terms and conditions the illness either has no known cure or has progressed to the point where it cannot be cured, and in the opinion of the attending consultant, the illness is expected to lead to death within 12 months.

    Flexibility - Relevant Life

    As we discussed, it’s important that your protection fits in well with <your employee / name of life assured>’s life. Zurich have built their products in a way that lets you choose the level of cover you want, and change it when <your employee / name of life assured>’s life changes. So where they can, Zurich have made it possible for you to add or remove benefits without them having to answer questions about their health, or changes in their personal circumstances. 

    Additional support - Relevant Life

    With a Zurich policy, <your employee / name of life assured> will have access to Zurich Support Services, an independent team of counsellors, advisers and legal experts. They offer support in the following ways:

    • Free and confidential health and wellbeing service
    • Impartial help and support on a wide range of issues
    • An independent service provided by Zurich’s partner, Workplace Options
    • Up to six sessions of professional counselling
    • Not just available at claims stage – they can be used throughout the lifetime of the policy
    • Available to <your employee / name of life assured> and their family with no limit on queries or issues

    Zurich Support Services is available to <your employee / name of life assured>, and their family, 24 hours a day 365 days a year and can be used from the moment they take their policy out.

  • Documents

Claims

birdhouse

Need to make a claim on behalf of your client?

Underwriting

blue key

Our expert underwriting team deal with each case individually

Tools and calculators

tablet

We've created a range of tools to support you