September 6, 2018

grandfather and granddaughter

Over 80 years old – Can I Get Gift Inter Vivos Insurance?

Gift Inter Vivos Insurance is a form of life insurance taken out over a 7 year term, that covers the potential Inheritance Tax (IHT) liability created, when someone gives a sum of money or other assets away while they are alive.

Our Client

Mr A and Mr B inquired on behalf of their Mother who is a 81 year old smoker. She will reach her 82nd birthday later in this year and has gifted them part of her estate to reduce inheritance tax for her children when she eventually passes.

The gift is valued at £2.5 million, meaning there could be a potential inheritance tax liability of up to £1,000,000. The clients require a life insurance policy for their mother which will cover any potential IHT liability should she pass away before 7 years. If she continued to live more than 7 years after she had made the gift, it becomes fully exempt from Inheritance Tax.

The levels and bases of taxation, and reliefs from taxation, can change at any time. The value of any tax relief depends on individual circumstances.

The Outcome

Quotes were run for a sum assured of £1m. However, due to the cost of the monthly premiums, the brothers could only afford to cover £750,000 of their liability.

Gift Inter Vivos Age/smoker status IHT Liability Monthly Premium Total Cost over 7 years
Quote 81/ smoker £750,000 £4311.02 £260,926.44

The maximum age someone can be at the expiry date of the policy is 89 years old, therefore we need to try and get the policy underwritten and started before our client’s 82nd birthday in a few weeks time. Based upon the client’s age and the sum assured, all insurance providers will request a medical with a nurse (usually carried out in someone’s home). In addition to this, all providers will also request a completed questionnaire from the applicant’s GP.

This is an ongoing case for Future Proof and we are continuing to keep the clients updated and actively chase for all necessary paperwork to ensure that the policy is completed by the client’s 82nd birthday.

Please note that any premiums mentioned are indicative only and based on this specific case study/ example, which is shown for information purposes only. Your own circumstances will determine whether the amount payable is more or less than the figure quoted.

Client ID: 132423148

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Next steps

Whilst you are welcome to get a quote on-line we would recommend you talk to one of our advisers.

Any quote that your adviser provides you with will take into account to your circumstances, your medical history, as well as your budget!

An on-line quote is just that – a quote – it isn’t a definite offer of cover. What really matters is the premium you are offered, after your application has been assessed.

Call Freephone 0800 644 4468 – Monday to Thursday from 09.00 to 19.00 and on Friday between 09.00 and 17.00.

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Whilst we will make every endeavour to help someone to arrange insurance, there is no guarantee of success.  All applications are subject to underwriting.

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