Why Relevant Life is just as relevant to entrepreneurs as it is to big business
Who is looking after the protection needs of SME businesses? The solutions that insurers offer seem to be designed either to be simple cost effective solutions for consumers or complex group benefit solutions for large corporate clients. But what about those in the middle? Small and medium sized businesses need covers that are suited to their needs and this is where Pulse Insurance can help. Pulse can look at group solutions for businesses with as few as 10 staff (and sometimes even less). We can tailor solutions to the company’s exact needs; whether cover is required for consultants, computer programmers, security guards or construction workers and whether in the UK or overseas.
Specialist protection always attracts interest but sometimes the best solutions aren’t always the most complicated: specifically we believe that Relevant Life is something that smaller businesses should actively consider because the tax advantages can make it unbeatable! If we take the example of “Daphne” a 60 year old company director with heart problems needing £250,000 of life cover. Monthly premium might be £100 but the real cost after taking tax and national insurance costs into account would be very different, in fact a relevant life policy would be nearly 40% less expensive than an individual policy.
|Please note these figures are illustrative only and should not be relied on for the purposes of tax or benefit planning.||Individual policy||Relevant Life policy|
|Cost to Employee||National Insurance contribution (Indicative)||-£2.56||N/A|
|Income Tax (Indicative)||-£25.64||N/A|
|Gross earnings needed||£128.21||N/A|
|Cost to Employer||National Insurance contribution @13.8%||-£17.69||N/A|
|Corporation Tax saved @20%||£29.18||£20.00|
|Tax adjusted total cost||£116.72||£80.00|
|Cover @0.48% rate||£250,000||£250,000|
A Relevant Life Policy is a term life insurance policy enabling employers to offer an individual death in service benefit to an employee. It pays a lump sum if the employee dies whilst employed during the period of cover. The key point is that the employer pays for the policy. Relevant Life Policies are similar to other types of life cover but they can provide a tax efficient benefit because they are provided by the employer for the employee.
Relevant life policies are quick to set up and Pulse has its own trust documents available.
Liz Easter, Pulse’s Group Specialist said, “We really feel that we can help smaller groups and SME businesses because we are used to offering bespoke solutions for our clients and to tailoring cover to meet some pretty challenging requirements. Relevant Life can be very well suited to the needs of smaller businesses where tax efficient solutions are required and significant cover is wanted for Directors or senior individuals.”
Remember, Pulse is a specialist in small and medium sized group business because of its ability to tailor cover to a company’s needs.
Torquil McLusky, Pulse’s Managing Director added, “We appreciate that SME businesses are different from larger businesses: we are able to take a flexible approach when assessing financial underwriting information especially where businesses are growing fast; we can offer terms even when there very wide ranges of salary and we can provide a range of products appropriate to different life stages of the business from shareholder protection to key man cover. I think we genuinely offer something different.”
Pulse doesn’t just offer Relevant life products. We can also help with:
- Key employees – “Keyman” cover
- Staff with health problems
- Group travel
- Overseas operations•
- Shareholder and investor protection
Who have we helped?
- Tailored cover – a retail group – age range 75-85
- Short term “peak” cover – International Law Firm – 144 Partners Travelling together to a 10 day “Partners’ Conference” in the USA
- Overseas cover – NGO (Missionaries) with a history of travel to Iraq and potential travel to DRC
If you would like to enquire please contact any one of the team on 01280-831430.