UK: Norwich Union launches Life Insurance with Tax Relief and Mortgage Life Insurance with Tax Relief

Norwich Union is today launching a new pension term assurance (PTA) product for single lives. This follows the increased flexibility in pension term assurance rules introduced as part of the A-Day pension reforms.

• Life Insurance with Tax Relief is a level term product for personal protection, designed to offer the benefits of a traditional life protection policy.
• Mortgage Life Insurance with Tax Relief, a decreasing term product, is also available for mortgage protection purposes.

Both products will benefit from tax relief on premiums (at the individual’s taxable rate).

Comparison of premium

Louise Colley, head of protection at Norwich Union, said: “The protection gap in the UK stands at a massive Ł2.3 trillion pounds¹ and over half the UK population does not have life cover in place². The introduction of tax relief will make these products more affordable and help more people get adequate insurance cover in place.

“The new PTA products should benefit many people; however as these products may have implications for an individual’s annual pension contribution and lifetime limit, we believe that people should take advice before making any decisions”.

Product features include:

• An individual does not have to have a pension in order to take out a Life Insurance with Tax Relief or Mortgage Life Insurance with Tax Relief
• Tax savings will be deducted at source for basic rate tax payers and higher rate tax payers can claim back through self-assessment
• Any cash lump sum will normally be free of inheritance tax
• Guaranteed Replacement Benefit cover option available for those who become ineligible due to exceeding annual contribution limit
• Terminal illness benefit is included (although this is dependant on the customer not exceeding their lifetime limit)
• Customers will automatically become a member of the multi-manager pension plan
• Single lives only / no options.

-ends-

¹ Source: Swiss Re Term and health watch 2005
² Source: Swiss Re Term and health watch 2005

Press office contacts:
Robert Pell 01904 452659 Out of hours 07800 699563
Cheryl Cox 01904 452791 Out of hours 07800 695275
David Gwyer 01904 452828 Out of hours 07800 699508

Notes to editors:

Norwich Union

• Norwich Union is the UK’s largest insurer. It is a leading provider of life, pensions and investment products and one of the largest Financial Adviser (FA) providers. FAs provide over 70% of the company's long-term savings business in the UK.
• Norwich Union is the UK’s largest general insurer with a market share of around 14%, with a focus on insurance for individuals and small businesses.
• Norwich Union’s news releases and a selection of images are available from Aviva's internet press centre at www.aviva.com/media