CASE STUDY
Overview
Managing inheritance tax liability can be complex, especially for individuals making large gifts later in life. In this case study, we explore how Henry Dannell supported a high-net-worth individual in arranging over £1.85 million in life cover to protect their children from significant inheritance tax liabilities on recent financial gifts. Despite their age and medical challenges, the process led to a tailored solution that met the client’s estate planning needs and offered lasting peace of mind.
Client Background
The client, aged 79, owns a farm with an equestrian business in the UK. They had recently gifted substantial sums to their children and wanted to ensure that, should they die within seven years, their family would not face a large inheritance tax liability. However, their age and existing health conditions made securing appropriate life cover difficult.
They turned to Henry Dannell through a trusted private client law firm known for advising high-net-worth individuals on estate and succession planning. Their goal was to establish a life insurance policy outside their estate that would specifically cover the inheritance tax liability related to the financial gifts.
Challenges
Securing life cover at age 79 is not straightforward. Many insurers exclude applicants of that age, and those who consider them often require detailed medical underwriting.
In this case, the entire underwriting process extended over nine months, involving multiple delays due to third-party reports and ongoing health assessments.
Our Approach
This was not just a technical challenge; it was a highly personal journey for the client.
Understanding this, we provided clear, continuous communication throughout the process. We worked directly with the insurer, the client’s GP surgery, and an independent medical underwriter to manage expectations and ensure all requirements were met.
Despite long periods of waiting and repeated requests for documentation, we ensured the client felt supported. Our proactive coordination helped maintain momentum and navigate each stage effectively.
The Outcome
After nine months, two life insurance policies were issued. These policies were structured specifically to cover the client’s inheritance tax liability and to preserve the full value of their gifts for their children.
The outcome offered more than just a financial solution; it provided emotional reassurance.
The client, new to working with an insurance advisor, expressed deep appreciation for the consistent guidance and care shown throughout the process.
Charles Alexander, Senior Mortgage and Protection Adviser at Henry Dannell, commented:
“This case was never going to be easy, but we knew that perseverance and patience would ultimately deliver the right result. We weren’t just securing policies; we were providing the reassurance that our client’s legacy would be protected and their daughters looked after. That’s what truly matters.”
Why This Matters
This case demonstrates the indispensable value of specialist support in securing whole-of-life cover for inheritance tax mitigation. For older clients, where complexity and emotion often intersect, having an expert intermediary makes all the difference. Navigating underwriting requirements, liaising with medical professionals, and managing prolonged timescales demands a level of diligence and care that a dedicated, experienced advisor can offer.
For high-net-worth individuals making significant gifts, a well-structured and expertly managed life insurance solution is one of the most effective ways to preserve family wealth and protect future generations.
This is a case study and not indicative of typical results. Past performance is not necessarily representative of future results. This information is for general purposes only and does not constitute financial advice. Please seek professional advice before making any financial decisions. Please also note: tax treatment is based on individual circumstances and may be subject to change in the future. Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of, and reliefs from taxation are subject to change. Please also note: the Financial Conduct Authority does not regulate will writing, inheritance tax planning, and trust planning.
