Life policies can also be taken out to provide protection for businesses and death-in-service benefits for employees.
Partnership/Shareholder protection – businesses run as a partnership or limited company can take out cover on partners or shareholders. In the event of their death, a lump sum can be paid out to the remaining partners or shareholders which can be used to purchase the interest of the deceased from their estate. Critical and terminal illness cover can also be added to the policy.
Key person insurance – key person insurance is the name given to insurance taken out by a company on an employee who is vital to the continued profitability of the business. The policy pays out a lump sum to the company in the event of the key person’s death. Critical and terminal illness cover can also be added to the policy.
Relevant life policies – this policy provides a lump sum in the event of the death or diagnosis of a terminal illness of the insured employee under the age of 75. The policy is normally arranged and paid for by the employer and written into trust for the benefit of the employee’s dependents.