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Life Insurance in Trust - Basic Help, Please Help!

2 replies

AngelaRaynersHair · 09/09/2025 15:57

I posted this on Money Matters but no-one posted so just trying Chat instead.

I am finding legal speak and paperwork quite difficult to get my head around so please could someone break this down for me in plain English, so I can check I understand?

I have set up a life insurance policy for myself (including critical illness cover) to last until our young child is 21. I am married (to my son's father) but he has his own separate policy through work already. In the event of my death I imagine the payout from my policy would go to my husband, and he knows my wishes are that this money be used for my son.

In the untimely event of both my death and my husband's death before my son is 18 I would like the money from my policy to be used for our son's care, education / university etc, and I am asking my brother if he would be the guardian in this circumstance.

I want to have my policy "written in trust" because I understand this means that in the event of mine and my husband's deaths my son would receive the money promptly without having to wait for probate proceedings. I also understand that the payout would not be liable for inheritance tax if the policy is written in trust.
So, next steps. I ask my brother to be a trustee - is that correct? The policy says I need 2 trustees, so do I include my husband or should it be someone else? obviously I'm thinking ahead to the worst case scenario of both of us dying suddenly and making sure my son is taken care of without us. So should my husband be a trustee or another person, as well as my brother?

What does this mean in practice - that they will jointly be responsible for the money in the event of both mine and my husband's deaths if my child is under 18? In that case I don't know who to appoint as the second trustee as there is no-one else in our family?

I am also writing a will in which I state that my wishes are my brother is our child's guardian in the event of our deaths, and that he would manage life insurance amounts (from both mine and my husband's policies) to support my son through his childhood.

Can anyone answer the questions above about trustees?
And is there anything I've forgotten here?

Thank you

OP posts:
SchnizelVonKrumm · 09/09/2025 20:02

You need to speak to a solicitor to get the documents drawn up properly. These are not really basic questions and if the documents (which it sounds like you are drafting yourself?) don't create the trusts you think you are creating then things could get messy in the event of your death.

AngelaRaynersHair · 09/09/2025 21:12

I’m not drafting anything myself. The insurance policy has trust forms to complete. I don’t own property and so the only element in my will is my life insurance and my child’s care.

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