Death in Service Insurance quote

What is Death in Service Insurance?

Death in Service Insurance (also known as group life insurance) is a policy your company takes out to protect your employees.

If an employee dies while working for you, the insurer pays a tax-free lump sum to their nominated beneficiaries. This is typically a multiple of their annual salary, such as 2x, 4x or even 10x their earnings.

Because the policy is:

• Arranged as group coverage rather than individual policies
• Not subject to individual medical underwriting for most employees
• Structured through a legal arrangement (usually a trust)

Your employees' families receive financial protection without:

• The employees needing to arrange personal life insurance
• Medical history preventing cover
• The lump sum payment forming part of the employees' estate for inheritance tax purposes

It's a cost-effective way to provide valuable employee benefits that offer genuine peace of mind.

A Death in Service Insurance comparison with the British Life promise

For peace of mind, ensure you have the following:

• 🧭

  Whole-Market access to Death in Service Insurance providers

  We connect you with FCA-authorised advisers who secure Death in Service cover from leading UK insurance providers. Your adviser will compare group life insurance policies to find the right benefit amount and structure for your workforce.

• 💷

  No Hidden Fees

  You'll never pay for our service. Our advisers are compensated by insurance companies only when they secure suitable cover for your business.

• 🛡️

  Expert guidance on employee benefits

  Death in Service Insurance isn't just about ticking a box. Your adviser will ensure your policy includes proper trust arrangements, appropriate eligibility criteria and coverage levels that make a genuine difference to employees' loved ones if the worst happens.

Key features at a glance

A well-designed Death in Service Insurance policy typically offers:

• Tax-free lump sum payment

  The benefit is paid tax-free to your employee's nominated beneficiary, usually as a multiple of their salary. Common levels are 2x, 4x or 10x the employee's annual salary, which gives their family meaningful financial security when they need it most.

• No medical underwriting for employees

  Unlike individual life insurance, group life insurance doesn't require employees to complete medical questionnaires or undergo health checks. Your coverage is based on the number and age profile of your workforce, not individual health status.

• Discretionary trust structure

  Most policies use a trust arrangement so the lump sum payout is paid directly to beneficiaries without forming part of the employee's estate. This protects the payment from inheritance tax while also speeding up the claims process.

• Flexible eligibility criteria

  You can choose which employees are covered. Many employers automatically include all permanent staff, while others set minimum service periods or exclude certain contract types. Your adviser will help you structure eligibility that works for your business.

• Additional bereavement support

  Many insurance providers include support services such as bereavement counselling, legal advice and guidance on funeral expenses to help families navigate difficult times.

Your adviser will tailor the benefit amount, trust structure and eligibility criteria to your workforce size, budget and company culture.

3 Steps to confidence in your Death in Service Insurance plan

Getting the right Death in Service Insurance policy is simpler than you think:

• 📝

  1. Start your quote

  After you share your business details, an FCA-authorised adviser who understands employee benefits packages and group life insurance structures will explain your options.
  

• 🤝

  2. Secure your policy

  Your adviser will review the whole market, comparing Death in Service providers to find cover that offers genuine financial protection for your employees' families at a cost that works for your business.

• 🔒

  3. Be confident in your coverage

  You can rest assured knowing your employees have a valuable benefit in place. Their families are financially protected, and you've demonstrated that you look after the people in your business.

How would it feel knowing your employees' families won't face financial hardship if something happens?

Start Your Quote

How Death in Service Insurance works

• Policy set-up

  Your company takes out a group life insurance policy that covers your eligible employees. You then come to an agreement with the insurer on the benefit amount (which is typically a multiple of the employees' salary), which employees are covered based on your eligibility criteria and the trust structure for any payouts.

• Premiums are paid as a business expense

  The insurance premiums are usually paid by the company, and they are generally tax-deductible as a business expense. Unlike many other employee benefits, Death in Service Insurance is not treated as a taxable benefit for employees, so they don't pay income tax on the value of the cover.

• What happens if an employee dies

  When one of your employees passes away while employed by your company, their nominated beneficiary (or the trustees if you are using a discretionary trust) contacts the insurance company with the employee's death certificate and any relevant contact details. The insurer then reviews the claim based on the policy terms.

• Lump sum is paid to beneficiaries

  On a successful claim, the insurer pays the lump sum directly to the nominated beneficiary or into the trust. Because the payment doesn't form part of the employee's estate, it's typically paid free of inheritance tax. The employee's family receives the money to cover funeral expenses, mortgage payments and ongoing living costs.

Your adviser will explain exactly how claims work in practice and will ensure your team understands this valuable benefit through clear communication materials.

Free Guide: The Business Leader’s Guide to Financial Protection

Get a clear, jargon-free overview of how to protect your income, business and family in one place. Our free guide walks you through the five essential types of cover every business leader should understand, a 5-minute risk assessment, the biggest protection mistakes to avoid, and what proper protection really looks like.

DOWNLOAD YOUR FREE GUIDE

Get your Death in Service Insurance policy quote today and give your employees the peace of mind they deserve.

Start Your Quote

Prefer to speak to someone?

Call our UK-based team on 0333 987 3960 (Mon-Fri, 9am-7pm) and we’ll connect you with an FCA-authorised adviser.