Royal London Relevant Life Plan Review

As one of the UK’s leading insurers, Royal London is well-regarded for its competitive pricing and high claim payout rates. The Royal London Relevant Life Plan is a tax-efficient life insurance policy designed for businesses to provide a death-in-service benefit to employees (including directors of limited companies).

Let’s take a look at the key features and benefits of the Royal London Relevant Life Plan. We’ll explore its suitability for your business and the Relevant Life Insurance tax benefits, along with the options that can be tailored to your company’s needs.

About Royal London

Since it was founded in 1861, Royal London has developed into one of the UK’s leading mutual insurers. As a mutual insurer, Royal London is owned and controlled by its policyholders rather than shareholders. This means that the policyholders help guide the company’s direction and are entitled to the company’s profits.

Royal London has a wide range of products including Life Insurance, Business Protection, Income Protection Insurance and Pension Plans. It also provides flexible coverage that allows you to adjust life insurance policies according to changing needs, such as level term life insurance, decreasing term life insurance and increasing term life insurance.

Royal London has an impressive claims payout rate; in 2022, Royal London paid out over £631m, which represented 99.4% of all claims to almost 80,000 customers and their families.

Royal London Relevant Life Key Features

The Royal London Relevant Life policy is particularly ideal for small businesses that don’t have enough employees to warrant a group life scheme. The Royal London Relevant Life Plan is designed to offer tax-efficient life insurance for employees and company directors and provides financial security for their beneficiaries in the event of death or terminal illness.

Premiums from Relevant Life Insurance are usually considered a tax-deductible business expense. If the policy is placed in a trust, you don’t need to pay Income Tax, National Insurance, or Inheritance Tax on the payout. The benefits paid out are also typically tax-free.

One of the Royal London Relevant Life key features include a support service called Helping Hand, which gives you access to recruitment and legal helplines. The insured employees and their beneficiaries can also access bereavement support, counselling, and legal advice.

What Does Royal London Life Insurance Cover?

Royal London offers a range of life insurance products that are designed to provide financial security in the event of death or terminal illness. The Royal London Relevant Life key features depend on the type of policy that you choose.

With the death benefit, a lump sum is paid out to beneficiaries if the policyholder dies during the term of the policy. These funds can help cover expenses such as mortgages and rent, family living costs, or funeral expenses. Terminal illness cover pays out the full sum assured early if the policyholder is diagnosed with a terminal illness and has a life expectancy of less than 12 months.

Depending on the policy, you could also make changes to the cover depending on major life events such as marriage, divorce and the birth of a child.

Level Term Insurance

This type of insurance provides a fixed payout that remains the same throughout the policy term. The premiums also stay the same throughout the duration of the policy. However, as the policy provides a fixed payout, inflation may reduce the real value of the payout over time.

Decreasing Term Insurance

With this type of policy, the payout decreases over time and typically has more affordable premiums than a level term policy. It’s not ideal for long-term financial security as the payout gradually decreases.

Increasing Term Insurance

With this type of policy, the payout increases over time, typically in line with inflation and the premiums increase accordingly. It helps maintain the real value of the payout despite rising living costs. This policy protects the payout from losing value over time and guarantees insured employees a higher benefit in the future.

Family Income Benefit

This allows the beneficiaries of insured members to receive a Royal London Relevant Life claim as an income rather than a lump sum pay out. This could result in lower premiums. The Family Income Benefit provides a monthly or annual income to beneficiaries and is designed to replace lost earnings and cover day-to-day living expenses. It runs for a fixed period (such as 20 years) and provides support to the insured employee’s spouse or children (or another beneficiary).

Should I take out Relevant Life Cover with Royal London?

There are various factors to consider when deciding between Relevant Life Insurance vs Life Insurance. Royal London Relevant Life Cover is a good option if you’re looking for tax-efficient life insurance for your company and employees. The policy’s premiums are tax-deductible as a business expense, and you don’t have to pay Income Tax, National Insurance or Inheritance Tax on payouts when they’re put in a trust. 

You can choose different types of cover, such as Level or Increasing Cover, to suit the financial needs of your company. There’s also the option to increase cover without medical underwriting in certain life events, such as marriage or the birth of a child.

Why get Business Protection from an Insurance Broker?

As an insurance broker, My Keyman Insurance can provide better value and tailored advice compared to going directly to a provider. We can compare policies from multiple insurers to find you the best cover at the lowest cost and ensure you’re not overpaying for unnecessary extras.

We can assess your company and recommend the right type of protection for your directors and employees to make sure you have the right level of protection. If your business needs multiple types of protection, we can structure policies efficiently to maximise tax benefits.

Contact us for a quote and we will help you find the best Royal London Relevant Life policy for your company. We can also find and compare Relevant Life for Company Directors and Relevant Life for Contractors.