Transact trusts online with Royal London
5 December 2016
Royal London announces enhancements to its protection digital capability with the launch of a new online trust service. The online trust service hosts a range of the most popular trust forms that advisers would require when placing a life policy in trust. A unique element of the service is that advisers can place new business and existing business in trust. Because the new service is fully automated this simplifies and speeds up the process of setting up a trust, by reducing the risk of forms getting held up or lost in the post as the trust is processed and completed online.
The five most popular trusts available on the system are:
- Relevant Life Trust
- Business Trust
- Gift Trust - Discretionary
- Split Trust - Discretionary
- Split Trust – Jointly owned survivor to benefit Discretionary
The process is straightforward to use: the adviser answers a few questions and is directed to the correct trust form. Once completed, the trust form is sent electronically to the plan owner, then the witnesses and finally the trustees for their e-signature – no wet signatures are required. The trust will only progress once each stage has been completed in the correct order. The system tracks the progress of the trust form and when the process is complete a copy will be sent automatically to Royal London.
The new service is designed to make the process of putting plans in trust easier for advisers, regardless of whether they currently write plans in trust. Advisers can contact existing clients whose life plans are not written in trust to see if this is something that they now require.
Ian Smart, Product Architect at Royal London, commenting on the new online trust service said:
“Writing a policy in trust ensures the proceeds go to the correct beneficiary and the wishes of the policyholder are carried out. The ability to write existing life business in trust is unique in the protection market. Currently fewer than 7% of Royal London life policies are written in trust; I hope our new online trust service will help to change that. The system is designed to ensure trust forms are completed and signed in the correct order; and we can track the progress online too. We will be looking to add further trusts to the service in the future.”
Emma Thomson, Life Office Relationship Director at LifeSearch said:
“This is a fantastic initiative from Royal London. Even after being informed about the benefits, too few clients put their plans into trust because the process is cumbersome and confusing. This new online trust process, that uniquely can be utilised pre and post risk, will make a huge difference to intermediaries trying to help more of their clients put their plans into trust, and I hope other insurers will follow suit. It’s very welcome news indeed for consumers and more importantly, their families.”
For further information advisers should visit: http://adviser.royallondon.com/protection/campaigns/online-trusts/
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For further information please contact:
020 7506 6719
Notes to editors:
The two main benefits of writing a plan in trust are:
- Quicker payment of claims
A plan written in trust means a claim can be paid sooner. If someone dies and their plan isn't in trust, the executors would need to apply for a Grant of Probate. This can take several months. Putting a plan in trust can avoid delays.
- The plan proceeds may be free of inheritance tax
Currently inheritance tax is payable at 40% on any part of an estate valued over £325,000 (2016/2017). Advisers can structure a trust to gift some or all of the benefits of a plan to beneficiaries. The gifted benefits would no longer be part of the client's estate if they died, which means the benefits would not be subject to inheritance tax.
About Royal London:
Royal London is the largest mutual life, pensions and investment company in the UK, with Group funds under management of £101 billion. Group businesses provide around 9.1 million policies and employ 3,179 people. (Figures quoted are as at 30 September 2016).