information

We use cookies to make sure your experience is as good as it can be. If you’re happy with that, just continue using the site. Learn more about cookies here.

skip to main content

Relevant Life Cover

Relevant Life Cover (RLC) allows employers to offer a death-in-service benefit to their employees. It’s a tax-efficient life insurance policy, set up by the employer and pays out a tax-free lump sum on the death (or diagnosis of a terminal illness) of the person insured. The proceeds go to the employee's family or financial dependants.

This cover might benefit high earning employees who might exceed their personal pension lifetime allowance or have members of group schemes who want to top up their benefits.

Key features

  1. Counts as a tax-deductible business expense (unlike some group schemes)
  2. The premiums are paid monthly
  3. Guaranteed premiums
  4. Benefits usually free from inheritance tax
  5. Maximum amount of cover available is £10 million

Important information

  • Must be written into a discretionary trust
  • We won't pay a claim if the person covered dies as a result of intentionally taking their own life within the first 12 months of the policy starting
  • The person covered must be a UK resident and an employee of a UK business
  • Cover isn’t available to sole traders or partnership companies; however it can be set up by a PAYE employee of a sole trader.

Find out more about the terms and conditions for Relevant Life Cover.

Setting up cover

Relevant Life Cover is arranged on an individual and life-of-another basis with the employer as the policy holder, and the employee as the person insured. Many employers choose to set the amount of cover as a multiple of their employee's salary. We suggest a maximum amount of cover based on the employee's age and gross annual earnings.

You can use our Relevant Life Cover calculator to work out if this cover is suitable for your client.

The company insures the employee/s and polices are written into a discretionary trust. Find out more about discretionary trust.


Cover options

How much cover to recommend

Many employers choose to set the insurance as a multiple of salary. We suggest your client selects an amount of cover based on age and yearly earnings, subject to the following maximum limits*:

  • 17 – 39 years old Up to 25 X remuneration
  • 40 – 59 years old Up to 20 X remuneration
  • 60 – 69 years old Up to 15 X remuneration

If the amount of cover your client chooses isn’t within the limits set out above, please let us know.

*The maximum amount of cover available with LV= is £10 million.

Use our Relevant Life Cover calculator as a guide for recommending cover.

Level or inflation linked cover
  • Level - the amount of cover remains the same from the start date until the end date of the policy.
  • Inflation-linked - cover increases each year in line with inflation and the premium increases by inflation x1.5.
Guaranteed increase options

The employer can increase cover for their employee (without any additional underwriting) within certain limits if they:

  • Increase their mortgage as a result of moving house or home improvement
  • Get married or enter a civil partnership
  • Have or legally adopt a child
  • Get divorced
  • Have an increase in salary

Quote and apply supported by intelligent online underwriting and 10% LAUTRO uplift


Options list icon

Business Protection options

Find out more about the type of businesses we cover and the policies available.

More on Business Protection options

Calculator icon

Tools and calculators

See all our business protection calculators available to simplify your client conversations.

View all tools and calculators

Team icon

Business Protection support

Our team will make sure that all your Business Protection applications are dealt with quickly and efficiently.

More on Business Protection support

Telephone handset icon

Why choose LV=

Your clients can access a range of resources and expert advice, as well as a number of value added services.

More on why to choose LV=

FOR UK FINANCIAL ADVISERS ONLY
LV=, County Gates, Bournemouth, BH1 2NF, UK