The Government's new civil partnership proposals will make it easier for same sex partners to plan t...
The Government's new civil partnership proposals will make it easier for same sex partners to plan to mitigate Inheritance Tax (IHT) by taking out life assurance policies on the life of their partner.
Under the proposals, the rules surrounding insurable interest ' which govern the circumstances in which individuals are allowed to take out life assurance ' are set to change. Previously, life assurance policies could only be written if there was an insurable interest, which only exists when there is a legally recognised relationship between two people and where the death of one would result in a quantifiable loss to the other.
However, the new proposals would establish an unlimited insurable interest between two registered partners, therefore enabling registered same sex partners to take out a life assurance policy on the life of their partner and subsequently carry out IHT planning. Commenting on the proposals, Margaret Jago, technical manager at Scottish Equitable Protect, said: 'The proposal to extend the insurable interest clause will make it much easier for same sex couples to take out a life assurance policy to insure against the potential for Inheritance Tax in the future,' she said.
