Contractor Life Insurance

As a contractor, it’s important to take out the necessary life insurance to make sure that your family are taken care of in the unfortunate event of something happening to you.

Life insurance is invaluable as a contractor; it’s there to give you the peace of mind that when you die, your loved ones will be financially provided for. This is an especially important factor if you are the main money provider, with a mortgage to pay and a family to provide for. By taking out life insurance for contractors, you will have peace of mind that your loved ones won’t have to struggle when you are no longer around.

What is Contractor Life Insurance?

Contractor life insurance, also known as Relevant Life Policy, enables you to protect your family in the same way the Death in Service benefit protects permanent full-time employees.

A contractor life insurance policy will pay out a predetermined lump sum to your loved ones and in most cases, the benefit will not be liable for inheritance tax as long as they are payable through a discretionary trust. By paying for the monthly premium through your company, you move the cost to your company expenses and the taxman – saving you money.

What Does Life Insurance Cover?

Life insurance for contractors is designed to cover an individual’s death whilst the policy is in force. You can choose different policy terms and you will be covered even if you pass away during that term. Relevant life insurance for contractors provides life cover to dependents of the policy holder, with funds paid via a discretionary trust.

The payout can be used to clear debts, pay off the mortgage or just cover everyday expenses. It can even go towards paying for your funeral if you haven’t set anything aside for that

The Benefits of Contractor Life Insurance

The top benefits that you will gain from life insurance for contractors UK are:

Lump Sum

Your family will receive a tax-free lump sum pay out if you die. This payout can be used as they choose, for example to pay off debts or to use as an ongoing income.

Tax Relief

You may save on income tax as premiums are a business expense paid directly by your limited company – not by you personally.

Multiple Policies

Your spouse or civil partner can take out an additional policy, if employed by your limited company.

No Inheritance Tax

Your dependants will pay no inheritance tax on the lump sum payout, as the policy has a discretionary trust arrangement.


The policy will follow you, so you can continue with it even if you move back into permanent employment. This means that no new policy underwriting or medical examinations will be required.

Get Contractor Life Insurance Advice with Contractor Protection

If you are a one-man limited company contractor and don’t have insurance, or if you currently pay for life cover personally, then our contractor life insurance policies could be just right for you.

For more detailed information on our flexible contractor life insurance plans, please contact Contractor Protection today and a member of the team will be in touch to assist you.

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