Relevant Life Cover

Business Protection

Designed to pay out a lump sum if an employee dies, or is diagnosed with a terminal illness during the term of the policy. Part of our flexible menu plan, choose a combination of covers with different amounts and terms, which can evolve to meet your clients’ and their businesses’ changing needs.

Key benefits

  • Tax efficient for both businesses and employees.  
  • Provides individual death-in-service benefits to employees outside of a registered group life scheme.
  • Scottish Widows Care, with RedArc, gives long-term practical advice and emotional support to business protection policyholders and their families from day one.
  • In certain circumstances, your client can increase their cover without further medical underwriting.
  • Terminal Illness Cover and Accidental Death Cover at no extra cost.
  • You can write up to 25 individual policies under one plan.
  • Cover can move with the employee without further underwriting.

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Key details

Basis of cover
  • Level - available as a lump sum.
  • Increasing - available as a lump sum. The sum assured will increase each year in line with the Retail Price Index (RPI). The increases will be at least 2% up to a maximum of 10%.
Minimum Term

1 year

Minimum age when cover starts

18

Maximum age when cover starts

73

Maximum age when cover finishes

75 next birthday

Minimum Sum Assured

£25,000

Maximum Sum Assured
  • Level - £25,000,000
  • Increasing - £15,000,000 (annual increases are allowed up to a total of £30,000,000)
Premiums

Guaranteed

Key documents

Key Features Document (PDF)

Relevant Life Trust Form (PDF)

Letter of Wish Form (PDF)

Relevant Life Calculator

See all our protection documents in one place, including forms, guides and brochures

View all product literature

Key questions answered

  • Yes, our definition of terminal illness is:

    • A terminal illness is an illness which has no known cure or had 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, and before the end of the policy term.

    On a valid terminal illness claim, the benefit amount will be paid out and the policy will end.

    Terminal illness will no longer apply if the person covered takes over ownership of the relevant life policy, as it will no longer be in trust.

  • An employer's business which is UK registered, and the employee who is habitually resident in the UK (meaning England, Wales, Scotland, Northern Ireland but not the Isle of Man or the Channel Islands), has a UK bank account and is not:

    •  Under 18
    •  74 or older (cover stops at age 75).

    The employer will own the policy and the employee will be the person covered but as Relevant Life Cover is written in trust, for the employee’s beneficiaries, the pay-out will go into the trust in the event of a claim.

  • This amount can vary depending on how the policy has been set up:

    • Level Term – £25,000 and £25,000,000.
    • Increasing Term – £25,000 and £15,000,000 (at the time of taking out the policy but annual increases allow up to a total of £30,000,000).
    • Once the policy is set up, there is the option to add further policies from as little as £2,000.
       
    • Level Term and Increasing Term – Minimum of 1 year.

    Relevant Life Cover must be taken out before the employee reaches their 74th birthday and will cease on their 75th birthday.

  • If the employee stops working for the employer there are three options available:

    • Their new employer can continue with the policy (with the same sum assured premium and term) without the need for further medical evidence or underwriting. The previous employer should then resign as trustee and a new employer should be appointed instead.
    • The policy can continue in trust with the employee paying the premiums themselves. The trustees can assign the policy to the employee who then takes over ownership of the policy without the need for further medical evidence or underwriting. The policy will not be held in the Relevant Life Cover trust and terminal illness will not apply.
    • The policy can be cancelled, the cover will stop and no further premiums would be taken.

    If the policy is to be assigned to the employee, careful consideration should be given to the tax implications of doing so by consultation with their local tax office.

  • Free Accidental Death Cover might apply to the employee while we are considering the application. For full details regarding Free Accidental Death Cover, including eligibility and exclusions, please see our leaflet (PDF)

  • If the employee’s circumstances change as a result of any of the events listed below, they can increase the sum assured without the need for further medical evidence.

    • Marriage/Civil partnership
    • Divorce/Dissolution of a civil partnership
    • Birth of a child, adoption or becoming a legal guardian
    • Mortgage increase
    • Promotion or salary increase

    For full details regarding Guaranteed Insurability Options including eligibility, restrictions and limits please see our Policy Provisions (PDF)

  • Scottish Widows Care, provided in partnership with RedArc, gives your client and their family access to practical advice and emotional support from the day the policy starts and for as long as it’s needed. See how we support your clients

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