Trusts
Securing peace of mind for your customers
How trusts can help your customers
By placing their policies in trust, your customers can take advantage of the benefits trusts can give them. We’re here to support you, so you can help your customers make the right choice for them.
Benefits of a trust
Trusts play an important role in protection and inheritance tax planning. Issuing a protection policy in trust means:
- Payments are made without any probate delay, when there’s at least one surviving trustee
- The proceeds will fall outside the policyholder’s taxable estate on death
- The proceeds will be paid in line with the policyholder’s wishes
Our range of trusts
| Type of Trust (document) | Product(s) | Life Protection Platform online access (pre sale only) | Pre or post sale submission? | Single or joint policies? | Change beneficiary? | When to use |
|---|---|---|---|---|---|---|
| Discretionary Trust Deed | Personal Protection Whole of Life |
Yes | Pre sale and post sale | Single life and joint life second death | Yes | Your customer can choose how they would like to distribute their death benefit, select multiple beneficiaries and retain their right to benefit from illness cover. |
| Discretionary Survivorship Trust Deed | Personal Protection Whole of Life |
Yes |
Pre sale and post sale | Joint life first death | Yes |
For use with joint life first death policies only. The death benefit is paid to the surviving policyholder however, if both policyholders die within 30 days of each other, the death benefit will be held by the trustees for the beneficiaries. |
| Absolute Trust Deed | Personal Protection Whole of Life |
No |
Pre sale and post sale | Single life and joint life second death | No |
To ensure your customer can make an outright, absolute gift to their chosen beneficiaries which cannot be changed. |
| Relevant Life Policy Trust Deed | Relevant Life | Yes |
Pre sale | Single life | Yes |
For use by an employer who wishes to apply for a policy on the life of their employee to provide death in service cover. |
| Partnership Keyperson Trust Deed | Business Protection Business Whole of Life |
Yes |
Pre sale | Single life and joint life first death | No |
To ensure that, if the keyperson dies or suffers from a critical illness, funds will be available to the partnership to cover for loss of profits or to repay a debt owed by the business. |
| Flexible Business Trust Deed | Business Protection Business Whole of Life |
Yes |
Pre sale |
Single life |
Yes |
To ensure that your customer and their co-business owners are entering into an arrangement under which, if they die or suffer from a critical illness, funds will be available for the others to buy your customer's interest in the business. |
How to set up a trust with us
The following policies can be put in trust online as part of the application process, without the need for a customer signature:
- Personal Protection
- Whole of Life
- Business Protection
- Relevant Life
Completing trusts online avoids duplication, will ensure that fields are completed fully and speed up the process of writing the trust. The process reduces the number of common errors that come with paper submissions.
Setting up a trust on an existing policy
- If a policy has already been issued, you must use a paper trust
- If more than one policy is being applied for, a trust deed must be completed for each policy being placed in trust
- When you get the completed trust deed from your customer, post the original signed documents to us and we’ll update the policy
- Zurich Assurance
Protection Operations
PO Box 4157
Swindon
SN4 4QB
Who are the parties to a trust?
The ‘settlor’
The settlor is the person who creates a trust. The settlor sets the rules for how the money in the trust should be managed and who should benefit from it.
The ‘trustees’
A trustee is the person or company chosen to look after and manage the trust. The trustee acts in the best interests of the beneficiaries, making sure everything is managed fairly and responsibly.
The ‘beneficiaries’
The people who will benefit from the money placed in a trust. This could be a spouse, civil partner or children – the settlor can nominate anyone they like.
- The settlor understands that, in placing their policy in trust they are giving ownership and control of their policy to the trustees they appoint
- As a trustee, the settlor will keep some control but some decisions about the policy will need to be approved by all trustees
- The trustees will get copies of correspondence relating to the policy. This will include letters relating to the payment status such as missed premiums
- Consider these elements with your customer upfront, so it can be agreed how the practical day-to-day administration of the policy will be managed with the trustees
Frequently asked questions
If a Life Protection Platform application is still in progress, then an online trust can be added and there is no need for a paper trust. Once a policy is issued, then the trust must be done via paper.
Many people choose a family member or friend, while some choose to appoint a professional trustee such as a solicitor or an accountant. They should be people the policyholder trusts to act in the best interest of the beneficiaries.
The settlor is automatically a trustee of their trust. We recommend that at least two additional trustees are added.
Yes. Depending on the trust wording the trustee’s permission may be needed for them to be removed from the trust. You can also appoint a new trustee to the trust.
If a trustee dies, the remaining trustees can continue however, a replacement may be needed.
Once the trust has been set up, it usually cannot be cancelled before it’s served its original purpose. So, it’s important to be sure that our trust is right, before you put it in place.
Yes, as long as they meet all legal requirements and can fulfil their duties effectively. Please check any specific conditions in the policy or local regulations to ensure a smooth process. Choosing someone local may help simplify administration and avoid potential complications.