PSI20.1.46 - Funding and Surpluses: Funding General - Death Benefits - Multiples of Salary

(This archived guidance relates to HMRC discretionary practice before the 6th April 2006. For current guidance on Registered Pension Schemes see the Registered Pension Schemes Manual)

[PN13.15]

Some Life Offices offer schemes where the term life sum assured necessary to secure death in service benefits consisting of both a lump sum and a widow’s/widower’s pension is calculated as a multiple of the employee’s salary varying according to the current age of the spouse. This is acceptable if the multiples are calculated assuming a positive net yield of at least 3% in respect of the period of payment of the widow’s/widower’s pension. Other assumptions should be within the guidelines laid down in PN13.10.

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