There are many forms of personal and family insurance and at Henry Dannell we specialise in offering high net worth (HNW) individuals’ bespoke solutions for all of them.
Life Insurance
The most common cover, and for the majority of our clients, the most important to them, is life insurance. This is partly due to the large loan size involved and the cost of the insurance being relatively cheap.
Life insurance will make sure your loved ones can pay off any mortgage and also maintain their lifestyle should the worst happen.
For HNW individuals, the need for life insurance usually increases with income and overall wealth. Given that this can fluctuate for those with complex income structures, it’s important that your life insurance is flexible, with the ability to increase or decrease cover as circumstances demand.
Income protection
Many HNW individuals are self-employed, which means that there’s a limited amount of assistance they can get should they be unable to work due to sickness or injury. Income protection insurance can replace up to 70% of your gross annual earnings each month, thereby covering your essential living expenses.
HNW individuals also frequently have complex incomes from multiple sources. This means that income protection cover has to be carefully calibrated and a bespoke solution generally sought.
A significant minority of HNW individuals are in occupations at high risk of injury – professional sports players, for example.
In addition, many HNW individuals choose to keep working beyond retirement age – again, with a carefully crafted solution, you can be covered up to the age of 70.
All of these factors mean that a bespoke income protection policy isn’t a luxury but an essential.
Critical illness cover
Income protection insurance typically functions as a short- or medium-term solution, whereas critical illness cover is for longer-term conditions such as cancer, stroke or heart attack.
Cover can be tailored alongside life insurance to protect your assets, or to protect your lifestyle throughout your working life. It’s essential to choose the right solution – plans can vary greatly in the illnesses they cover, their conditions for insurance, and much else.
In addition, this is one area of insurance where premiums can vary significantly due to underlying conditions, among other factors. Thus it’s another reason why specialist advice is essential to ensure you don’t pay too much.
If you already have critical illness cover and are dissatisfied with it, we can review your insurance. Our expertise and experience means we can review and historically compare almost every policy ever created – we can then use these findings to help you secure the best and most effective cover for you.
Life insurance for inheritance tax mitigation
With the ever-increasing value of properties and assets, Inheritance Tax (IHT) is a growing concern. Currently, after allowances, any estate worth above £500,000 for individuals or £1,000,000 for couples is liable to 40% inheritance tax.
Fortunately, if properly planned, there are several ways of mitigating this. One is to gift assets to beneficiaries while the donor is alive. The longer they survive after making the gift, the less inheritance tax there will be to pay. If they survive for seven years after making the gift, no tax whatsoever is liable.
One way of protecting this is via a Gift Inter Vivo life insurance policy. This will payout to the recipients if a donor dies within seven years of making the gift. The payment isn’t a fixed sum but instead matches whatever the IHT liability is at the time of the donor’s death. If the donor does survive for seven years, no IHT is due and therefore the policy will end.
A whole-of-life insurance policy represents a more comprehensive solution. This is especially suitable for couples whose main residence is worth more than the IHT threshold. If it also represents their sole significant asset, they can’t significantly mitigate IHT on their estate by gifting other assets before they die. However, by taking out Whole of Life Joint Life/Second Death insurance and making the sum assured the subject of a trust, the proceeds can be paid to beneficiaries outside of the estate, which they can use to cover any IHT liability.
How Henry Dannell can help HNW individuals secure the right insurance
At Henry Dannell we help our clients to secure the right insurance to protect them and their loved ones. Our first step is to ensure that you have all the information you need to understand the available options and to make the right choices.
As protection policies often require bespoke underwriting and specialist advice, we have access to the whole insurance market, including specialist niche providers. That way you’ll get the service – and cover – you deserve.
For a free initial consultation, please call 0204 5999 444 or email info@henrydannell.co.uk
Please note: These plans have no cash in value at any time and will cease at the end of the term. If premiums are not maintained, then cover will lapse. These plans have no cash in value at any time and will cease at the end of the term. If premiums are not maintained, then cover will lapse.
