Case Study: Accountants Save Clients 56%

We have recently started working with accountants to re-quote life insurance for their business owners as we have found they are the best people to introduce the relevant life concept to their clients.

One of these introductions for a company with a director with no current protection policy in place, so a brand-new quote was needed.

This client was looking for £1,000,000 in life, only cover to help his family should they pass away in earlier life. He decided that no serious illness cover was needed, which greatly reduced the premiums.

Policy

– Level 25 years term insurance policy for the cover of £1,000,000

– Life cover only

– Premiums £42 a month

After researching the entire market, we concluded that Zurich would be the best provider and offer the most competitive rate.

As the premiums are to be paid by the company, a considerable tax saving was made.

Usually, a policy with a £42 a month premium paid as a personal expense would require a gross capital amount of £76.82. This higher amount is needed due to the deduction of corporation and dividend tax to provide the client with the net £42 to pay the premium.

However, claimed as a business expense, this reduced down to just £34.02, making a saving of 56% and £42.80 a month as no corporation tax or dividend tax would apply.

Over the course of the policy, this is a saving of £12,840.

Total saving was 56% compared to an ordinary policy, a saving of £42.80 a month and a policy term saving of £12,840.

Written by

Alex Ogden DipFA | Director | Executive Life

Alex Ogden DipFA holds the Level 4 Diploma for Financial Advisers (DipFA) awarded by the Walbrook Institute London, formerly known as the London Institute of Banking & Finance (LIBF), the FCA's benchmark qualification for retail investment advisers. He is authorised by the FCA, Ref: AJO01072. View the FCA register entry.

Tax rates and thresholds are subject to change.