Launch Pad: Protection

The product is available for smaller businesses that do not offer a group life scheme, with premiums considered as an allowable business expense.

The policy is also written into trust so death in service benefits can be paid without triggering inheritance tax.

The product is based on LV=’s existing flexible protection plan term product that provides terminal illness cover.

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Mark Jones, head of protection for LV=, said: “This relevant life cover is designed to help employers to attract and retain the best people within their business by offering their employees valuable life protection at a reduced cost to the business.

“The continuation option means that the employee can feel confident that he is able to remain protected even if they change employer.”

Adviser comment: Colin Last, director of Berkshire-based Tamar IFA, said: “Relevant life cover definitely has its place, particularly for higher-rate taxpayers. I am concerned that it isn’t being discussed with clients more often. However advisers need to take health issues into account. Any tax benefits could be negated by the diagnosis of serious health conditions in the future which would change the level of cover and possibly push up premiums.”

Conditions include:

- Cover ends before the insured employee reaches 75

- Policy only provides life and terminal illness cover, not other protection options

- Cover must be written into trust from the outset

- LV= executive assistance plan is included with the policy, offering access to various counselling and advice helplines