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ARTICLE · 09 APRIL 2012

Fixed Protection And Life Cover – "As You Were?"

CMS Cameron McKenna Nabarro Olswang
Explore more from CMS Cameron McKenna Nabarro Olswang

We recently highlighted an issue relating to the potential loss of fixed protection under life cover arrangements.

United KingdomInsurance
Peter Coyne
Peter Coyne
Laura Jamieson
Laura Jamieson

We recently highlighted an issue relating to the potential loss of fixed protection under life cover arrangements. A sudden change of heart by HMRC means that the concerns this had raised for members, trustees and scheme employers have largely been allayed.

A reminder

Our  Law-Now last week flagged HMRC's treatment of arrangements to pay lump sums on death, capped by reference to insurance policy proceeds, as "hybrid arrangements". The impact of that interpretation, under the fixed protection legislation, was that if an individual who had elected for fixed protection was a member of such an arrangement, he would lose that protection at the time the next insurance premium under the policy was paid on or after 6 April 2012.

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