Legacy Life Trust

Legacy Life Trust

Common Issues With Life Assurance Policies

Issue 1: Marriage after death

Q. After the death of the first partner or spouse, all the assets will be solely owned by the surviving spouse/ partner. What happens if the surviving spouse/partner remarries?
A. The inherited estate could be lost to the new spouse, disinheriting your children.

Issue 2: Inheritance tax

After the death of the first spouse/partner, the first life assurance will pay out into your estate and inheritance tax could be payable if this takes your estate over the Nil Rate Band.

After the death of the second spouse/partner, the second life assurance pays out, which will add more value to your estate and add further inheritance tax liabilities for you and possibly your beneficiaries down the line.

Issue 3: Care costs

Q. After the death of the first spouse/partner, the life assurance benefits pass into the estate of the surviving spouse/partner. What happens if the surviving spouse/ partner needs care?
A. The whole estate would now be assessed for care which may include any life assurance benefits from the deceased.

Creditors and bankruptcy

Q. What would happen if the surviving spouse/partner were to be subject to creditor claims/bankruptcy?
A. All or part of the life assurance could be swallowed up in these claims, leaving your remaining family without

The Solution – A Legacy Life Trust

While these scenarios are very worrying, there is an answer – assign each life assurance policy to a Trust, with each Trust receiving assets up to the available Nil Rate Band of inheritance tax. This means that rather than the benefits of each policy passing to the surviving spouse/partner and being exposed to risk, they pass into the nominated Pilot Trust and are protected.

Protecting your pension plan

Without the right preparation, any death benefits payable from your pension are vulnerable to the following:

  • The remarriage of the surviving spouse
  • Care costs If the surviving spouse remarries

Q. If the death benefits pass to the surviving spouse/ partner after their spouse dies, what happens if the surviving spouse/partner remarries?
A. All or part of the pension fund could be lost to your children upon the spouse’s/partners subsequent death or divorce.

Care costs

Q. If the death benefits pass to the surviving spouse/ partner after the death of their partner, what happens if the surviving spouse/partner needs care?
A. The whole estate would be assessed for care which may include any pension benefits considered available to them.

 

The Solution – A Legacy Life Trust

Put in place a carefully worded and bespoke nomination for each pension provider. This will provide the best level of flexibility and efficiency following your death, whatever type of pension you hold.

Without the right protection, any benefits payable from your pension life assurance can be assessed and are vulnerable to any of the following:

  • Marriage after death
  • Inheritance tax
  • Care costs
  • Creditors or bankruptcy
  • Sideways disinheritance

Take The First Step Now

Complete the form below and one of our expert advisors will contact you within 15 minutes

100% privacy guaranteed

Testimonials

Very helpful, courteous and efficient - just what I wanted I did not want to be talked down to, or told what to do - and they were just what I was looking for - professional and efficient

David Blake, Feb 11 2017

The team at legacy wills have been very helpful and extremely courteous when talking through the full process with me. Would highly recommend.

Miss Jane Adiller, November 3

I found the advisor extremely helpful, explaining clearly any points which I was unsure about. I received my Will some days later and was pleased that the company followed up to check that I was happy with it. I did not feel pressured in any way and I would recommend this company to anyone wishing for a straightforward and efficient service.

Linda Leary, November 3

Legacy wills explained every step very clearly and anything you forgot to ask they encouraged you to contact them, they also made you feel that no question was to big or small they would always find the answer.

Juliet Patricia, December 3

Request a call back

Complete the form below and one of our expert advisors will contact you within 15 minutes