Whole of Life

A whole of life insurance policy is designed to cover the life assured for the duration of their entire lifetime. It pays out the sum assured in the event of death, whenever that death may occur, providing the policy remains in force.

A whole of life policy combines life assurance products with an investment. The monthly or annual premiums are partly used to pay for life assurance and partly invested to build a cash value within the policy. The cash value can then be used to pay for premiums in later life when there is greater risk and therefore higher premiums, or the policyholder can withdraw the cash value at any time, should they so desire.

The policy remains in force while premiums are being paid or where there is sufficient value within the investment to continue paying premiums.

Whole of life policies are especially useful for inheritance tax (IHT) planning for British nationals. Such policies are often written on a ‘joint-life second death,’ or ‘last survivor’ basis, as the estate of the first spouse to die passes to the surviving spouse free of IHT. IHT therefore only becomes due when the second spouse dies and the estate passes to the family or others. However, this isn’t the case where one spouse is non-UK domiciled.

As with all areas of financial planning, you must seek the advice of a properly qualified professional.

Please contact PWS Group today to speak to a specialist in IHT planning and to arrange your whole of life policy.