Latest news with #LifeSearch
Telegraph
05-06-2025
- Business
- Telegraph
Families rush to take out life assurance ahead of Reeves's inheritance tax raid
Rachel Reeves's inheritance tax changes have sparked a scramble for life assurance as people seek financial security for their families, experts have warned. In her maiden Budget, the Chancellor introduced a £1m cap on business and agricultural property relief from next year, and will move pensions into consideration for inheritance tax from April 2027. Insurance broker, LifeSearch, said sales of whole life cover, also known as life assurance, have increased by 230pc since last autumn, while major providers, Royal London and VitalityLife, also reported surges in enquiries. One expert said the Budget had created 'a real problem' for inheritance tax planning, while another said business owners and farmers were now pursuing life cover for the first time. When she delivered her Budget last October, the Chancellor confirmed new inheritance tax rules for business owners, farmers and unspent pensions. In the event of the owner's death, inheritance tax will now be charged on 50pc of the value of business or agricultural assets above £1m from April 2026. Pensions will also be considered for 40pc inheritance tax 12 months later – leaving some families facing an effective tax rate of over 90pc. Experts said the changes had led to an increase in life assurance policies. These are more expensive than life insurance policies because they pay out regardless of when death occurs, so they are often purchased to cover future inheritance tax bills. James Robinson, of advisers Forvis Mazars, said: 'The Budget has created a real problem for people thinking of their pensions or business as being inheritance tax efficient. 'Almost all of our clients want to talk about the inheritance tax changes in some way. We saw a steady increase in the run-up to the Budget and since then, we've seen a marked increase in these conversations. 'It's more of a shock for business owners. They will need to figure out how they fund this tax charge and whether this could affect original plans for the business. It could create a risk for how the business continues in the right way and in the right hands if a proper plan isn't put in place by the time the changes take effect.' Alan Richardson, of LifeSearch, said the Chancellor's changes had also led to business owners and farmers starting to take out policies. He said: 'For the first half of our financial year, which started in September, we've seen a 230pc increase in whole of life policies for the purpose of inheritance tax. 'Before the Budget was announced, we never got a business or a farm owner phoning us up to talk about inheritance tax liabilities, but we do get that now. 'It's also interesting that the average age of people asking for whole of life has dropped off. Historically, it's been 60 to 63, but we're getting younger people now asking about inheritance tax.' Many insurers sell their life products directly to customers, but then cover their risk with larger global companies, known as reinsurers. One such multinational reinsurer, Gen Re, reported an 18pc increase in its sales of whole of life policies during the first three months of 2025 compared to the same period last year. Kevin Carr, a financial services specialist and former independent financial adviser, said this was due to the Budget. He said: 'Gen Re's data shows a substantial increase in the take up of whole of life insurance in the UK, which is no doubt related to last year's Budget and the pending inheritance tax changes. 'It's not driving the mass market, which is people buying it for their mortgage at £20 a month, but I certainly know lots of advisers that specialise in the market where people want to cover their inheritance tax liability and they've been incredibly busy since the Budget. 'People are looking at the changes, seeing an even larger bill than they'd expected and are taking steps to provide for their loved ones.' Major UK insurers also confirmed they were being approached more often. Royal London revealed a 50pc increase in quotes for protections linked to inheritance tax, while VitalityLife also said it had seen more people looking for and buying life insurance.
Yahoo
19-03-2025
- Health
- Yahoo
What's driving the surge in UK private health insurance?
In recent years, a trend has emerged across the UK where nearly one in eight Britons now have private medical insurance. Yahoo Finance UK spoke to LifeSearch CEO Debbie Kennedy to shed light on what is driving this growing reliance on private healthcare. With NHS waiting lists stretching into months and families increasingly anxious about timely access to medical services, Kennedy explains that many are turning to private insurance not just as a safety net for hospital treatment, but as a proactive way to ensure quicker access to primary care, diagnostics and even mental health services. Kennedy highlighted some striking figures during the interview. According to industry data from 2023, approximately 4.7 million people in the UK had private medical insurance, with more than 400,000 new policies taken out in that year alone. 'There has been a surge,' Kennedy noted. 'We are all acutely aware of the strain on the NHS – not just the 18-month waiting lists for operations, but the everyday challenges of getting GP appointments and prompt diagnoses.' Read more: How to achieve financial stability in retirement For many, the decision to secure private cover is about more than just emergency treatments. It's about ensuring that when a health concern arises — whether it be a persistent ailment, a sudden injury or even mental health issues – there is a faster, more accessible route to care. As Kennedy explained, the issue isn't solely about what happens if one is admitted to hospital. 'It's more about, how do I get to see someone to talk about a concern I have? How do I get a diagnosis?' This sentiment has resonated with a growing number of individuals who see private insurance as a means to bypass some of the bureaucratic delays in the public healthcare system. With the NHS facing ever-increasing demand, the appeal of being able to consult a GP quickly, access early screening tests, or receive specialist care without long waiting times has never been higher. Kennedy noted that private insurers are evolving to meet modern healthcare needs. 'Insurers are now developing better products,' she explained. 'It's not just about gold-plated employee schemes anymore. There are products with everyday benefits that cater to a range of needs – from physiotherapy and fracture cover to mental health support, including talking therapy sessions.' Read more: UK buy-to-let investors look North in search of higher yields This evolution in product offerings means that private medical insurance is becoming accessible to a broader spectrum of the population. Consumers today can choose policies that fit their budget without sacrificing essential benefits. Kennedy stressed the importance of shopping around and doing thorough research. 'It is important to shop around, do the research and yes, do ask an adviser if you want help on this,' she advised. Despite the growing popularity of private medical insurance, many consumers still harbour concerns about claims and payouts. Kennedy acknowledged these fears, noting that it is a common worry among potential policyholders. 'I even have family and friends say the same to me, 'Oh, but I bet you won't ever pay out," she added. Read more: Mortgage mistakes to avoid for first-time buyers and wealthy individuals To address this scepticism, Kennedy pointed to claims statistics that reveal over 98% of claims are paid out – a figure that underscores the reliability of these products. 'When you look at the claim statistics for our industry and life insurance protection, it's clear that we do pay out,' Kennedy said. She added that this data comes from figures provided by the Association of British Insurers, which has mandated transparency across the board. At the end of the day, you might have your policy for 10 to 15 years before you need to use it,' Kennedy explained. 'It is essential that you have confidence that it will work.' In today's digital age, Kennedy said that efficiency and ease of access are paramount. While many industries are being transformed by technology, the life insurance sector has been somewhat slow to embrace these changes. Kennedy, however, sees a bright future where technology and human service are seamlessly integrated. 'Customers want to do things online, and they want to do it easily,' she observed. Yet the digital experience isn't simply about digitising paper forms – it's about creating smarter, more intuitive journeys that guide customers through the often complex process of taking out a policy. Kennedy envisions a future where digital platforms not only facilitate transactions but also provide timely human support. 'If someone needs reassurance or advice during the application process, they should be able to speak to a real advisor,' she emphasised. Often, discussions about insurance tend to focus on older demographics, under the assumption that younger individuals are at lower risk. Kennedy, however, challenges this notion, arguing that even those in their 20s and 30s stand to benefit significantly from taking out insurance policies early. 'Many young people think, 'My risk of dying is probably low,' but in your 30s, you're actually eight times more likely to have an accident and be off work for at least two months than to die,' she explained. The financial implications of a prolonged absence from work can be severe – ranging from loss of income to difficulties in managing everyday expenses. This is where income protection or sick pay cover becomes critically important. Moreover, younger policyholders often benefit from lower premiums since rates are largely age-dependent and many will be in good health when they first take out a policy. Kennedy also highlighted the flexibility of modern policies that can adapt as one's life circumstances change. Whether it's securing a mortgage, starting a family or changing jobs, the benefits embedded in these policies can be adjusted without the need to reapply. 'It's about looking beyond the death benefit,' she explained. 'There's a suite of benefits that make these policies relevant to a younger audience.' Read more: How will Trump's tariffs impact UK and EU trade? For those contemplating private medical insurance, Kennedy offers some prudent advice. First and foremost, consumers should conduct thorough research and compare products across different insurers. 'It is important to shop around and ask for advice,' she stressed. The variety in products means that there is likely a policy that can be tailored to individual needs and budgets. Additionally, transparency in claims processing is crucial. By understanding the performance of the industry – backed by figures from the Association of British Insurers – consumers can gain further insight about whether insurers will honour claims when it matters most.
