IHTM20000 - Life Policies: Contents

Introduction to life policies
Investigating Form IHT410
Investigating Form IHT403
Particular situations to look out for
Definitions
Types of policy
Trusts of life policies
Policies on the deceased's life not connected with any other transaction (except a trust)
Policies on the joint lives of the deceased and another
Potentially Exempt Transfer treatment for renewal premiums
Policies based on the life of another not connected with any other transaction (except a trust)
Life policy linked with an annuity
Pure Endowment Policy linked with a Term Assurance Policy
Life Policy linked with a loan and Inheritance Trusts
Policies with Countrywide (formerly Premium Life) Assurance Company
Policies with Canadian assurance companies
Annuities payable to deceased/transferor by insurance companies

Introduction to Life Policies

IHTM20011What a life policy is
IHTM20012Life policies and Inheritance Tax

Investigating form IHT410

IHTM20021Introduction to Form IHT410
IHTM20022If the answer to Question 1 is Yes
IHTM20023If the answer to Question 3 is Yes
IHTM20024If the answer to Question 4 is Yes
IHTM20025If the answer to Question 7 is Yes
IHTM20026If the answer to Question 10 is Yes
IHTM20027If the answer to Question 10 is Yes: chart
IHTM20028If the answer to Question 12 is Yes
IHTM20029If the answer to Question 14 is Yes

Investigating form IHT403

IHTM20041Introduction
IHTM20042Gift of an existing life policy
IHTM20043Gift of an existing life policy: chart
IHTM20044Payment of premiums on a life policy for the benefit of someone else
IHTM20045Payment of premiums on a life policy for the benefit of someone else: chart
IHTM20046Assignment of the right to a lump sum due under an annuity contract

Particular situations to look out for

IHTM20061(This text has been withheld because of exemptions in the Freedom of Information Act 2000)
IHTM20062Midland Life (or HSBC) Cluster Trusts

Definitions

IHTM20081"Assured" and "life assured"
IHTM20082"Premium"
IHTM20083"Surrender value" and "open market value"
IHTM20084"Claim value"
IHTM20085"Insurable interest"
IHTM20086"Sum assured"
IHTM20087"Back-to-back policies"
IHTM20088"Mortgage protection policies" and "Mortgage indemnity guarantees"

Types of policy

IHTM20101Whole life policy
IHTM20102Term, term assurance or temporary policy
IHTM20103Pure endowment policy
IHTM20104Endowment policy
IHTM20105With-profits policy
IHTM20106Unit-linked policy
IHTM20107Alternative benefits policy

Trusts of life policies

IHTM20141Introduction

Policy settled on its own trusts

IHTM20151Express life interest in favour of settlor
IHTM20152Conditions required for policy to be comprised in a settlement
IHTM20153Life interest in favour of a beneficiary other than the settlor
IHTM20154Examples: England, Wales and Northern Ireland [DQ]
IHTM20155Examples: Scotland

Policy settled on other trusts

IHTM20160Policy settled on other trusts

General power over policy proceeds

IHTM20170General power over policy proceeds

Married Women's Property Act policies

IHTM20181Introduction
IHTM20182Proper law
IHTM20183The rule in Phipps v Ackers
IHTM20184Trustees' remuneration
IHTM20185No trustee appointed

Policies on the deceased's life not connected with any other transaction (except a trust)

IHTM20201Introduction
IHTM20202Contracts of life insurance in existence prior to 22 March 2006

Policy unconnected with a gift or trust

IHTM20211Introduction
IHTM20212Possible discount
IHTM20213Policies with Independent Order of Foresters, Homeowners Friendly Society, Family Assurance Friendly Society and similar friendly societies

Policy effected by the deceased for their own benefit but gifted later

IHTM20221Introduction
IHTM20231Value of policy: General rule
IHTM20241Value of policy: Special rule: Introduction
IHTM20242Value of policy: Special rule: Exclusions from special rule
IHTM20243Value of policy: Special rule: Term assurance policies excluded from special rule
IHTM20244Value of policy: Special rule: Modification of special rule for unit-linked policies

Policy effected for the benefit of someone else from the start

IHTM20251Introduction
IHTM20252Policy contains option to surrender bonuses to the transferor

Policies on the joint lives of the deceased and another

IHTM20301Introduction
IHTM20302Ascertaining the beneficial interests
IHTM20303The situations that can arise and the Inheritance Tax claims that can result
IHTM20304Joint mortgage protection policies *

Potentially Exempt Transfer treatment for renewal premiums

IHTM20331Payment of premiums for policies in Accumulation and Maintenance or Disabled Trusts
IHTM20332Payment of premiums for policies gifted to individuals *

Policies based on the life of another not connected with any other transaction (except a trust)

IHTM20351Introduction
IHTM20352Chart

Life policy linked with an annuity

IHTM20371Introduction and background
IHTM20372What to do first
IHTM20373What to do when TG Actuarial Team's advice is received
IHTM20374The current statutory position
IHTM20375The Associated Operations test
IHTM20376Annuity and policy issued by different companies
IHTM20377Deferred annuity contract

Pure Endowment policy linked with a Term Assurance policy

IHTM20401Introduction
IHTM20402Differences between PETA schemes and Discounted Gift schemes
IHTM20410PETA schemes

Discounted Gift Schemes

IHTM20421Introduction
IHTM20422What to do
IHTM20423List of Companies and Scheme names
IHTM20424Basic scheme
IHTM20425Quantification of Inheritance Tax claim
IHTM20426Factors affecting the open market value of the retained rights

Capital Conversion or Flexible Funding plans

IHTM20450Capital Conversion or Flexible Funding plans *

Life Policy linked with a loan and Inheritance Trusts

IHTM20501Introduction
IHTM20502What to do
IHTM20503Chart

Original scheme

IHTM20511How the original scheme typically worked
IHTM20512Legislation designed to counteract scheme
IHTM20513Revised scheme following legislative changes

Reverse Loan scheme

IHTM20521How the reverse loan scheme typically worked
IHTM20522Legislation designed to counteract reverse loan scheme *

Policies with Countrywide (formerly Premium Life) Assurance Company

IHTM20601Introduction
IHTM20602What action to take
IHTM20603How to identify the two schemes

Policies with Canadian insurance companies

IHTM20611Introduction
IHTM20612The companies concerned
IHTM20613Governing law

Annuities payable to deceased/transferor by insurance companies

IHTM20631Introduction
IHTM20632Purchased life annuities: types and potential claims
IHTM20633Annuities ceasing on the death
IHTM20634Annuities which continue after the death
IHTM20635Annuities purchased in joint names