A Zurich Relevant Life policy lets a company buy life cover on a director or employee, and Zurich says the cover can only be issued into a relevant life policy trust, for which it supplies a draft trust deed. An FCA-authorised broker can talk a company through this policy and its trust deed, and the form on this page starts a free call-back.

Can a company director be covered by the Zurich Relevant Life policy?

Yes, where the director counts as an employee of the company paying. Zurich’s key features (PW720504007, read 21 October 2026) say: “Company directors (including shareholding directors) and company officers can also be treated as ‘employees’ for this type of policy.” The company is the policyholder, and the director is the “life assured”, the person whose death or terminal illness triggers the payout.

The same document names three people who cannot be covered: “a sole trader in their personal capacity as business owner”, “an equity partner in a partnership” and “a member of a limited liability partnership”. Zurich’s trust deed notes draw the same line around the word employee. A limited company can therefore cover its directors, whereas a sole trader cannot cover themselves.

Zurich prints some further conditions. A business must be registered or incorporated in the UK. The employer and the life assured must both be UK residents, and the life assured must have been with a doctor in the UK for six months before the application, and still be registered with one on the start date. The employer has to obtain the employee’s permission for Zurich to request medical records for up to six months after the start, and if that permission is refused, the policy and cover end. In a one-director company the director gives that permission personally, even though the company is the one buying the policy.

What does the policy pay, and how much cover can a director have?

If the life assured dies, or is diagnosed with a terminal illness, within the term, Zurich pays a lump sum and the policy then ends. The lump sum is paid to the trustees of the relevant life policy trust. Cover can be level, increasing (annual rises of 3%, 5% or the Retail Price Index, with the premium going up 1.5% for each 1% of added cover) or decreasing, reducing at a rate you pick to follow a loan.

Pay sets the ceiling. Zurich’s table allows up to 30 times total remuneration for ages 18 to 39, 20 times for ages 40 to 49 and 15 times from age 50. For a director, the definition is the useful part: “Remuneration includes salary, bonuses, benefits in kind and dividends earned.” So dividends count towards the multiple, which matters for owners who draw a small salary. The multiples at other insurers are compared on relevant life cover limits.

Zurich’s table lets cover start from age 18 to 73, with a term between one and 50 years and a maximum age of 74 at the end. It explains that an age shown as 73 means before the 74th birthday. During the term you can raise or lower the amount of cover or the term; depending on the change, Zurich may need to ask about the life assured’s health and personal circumstances, and any change is likely to alter the premium. A milestone benefit lets cover go up after a life event, such as a house move, a marriage or a child, if you ask within 90 days and without new health questions. The extra cover is capped at the lower of the original sum assured or £200,000, and the life assured must be 54 or younger.

Zurich lists what the premium depends on, from the life assured’s age and tobacco use to the length of the term, and the price itself is set out in the ‘Confirmation of terms’ Zurich issues. The broker who rings back can take the details of your own director and explain how a quote is built. The effect of tax on the company’s outlay is on relevant life insurance cost.

Which trust deed does Zurich use, and who signs it?

Zurich’s form is called the Relevant Life Policy Trust Deed, and Zurich describes it as “A discretionary trust for use by an employer effecting a Relevant Life Policy with Zurich.” It is provided in draft for the employer’s legal advisers to approve. Zurich’s key features add that while it can give you a draft trust, it cannot advise whether the draft suits your business. Trusts across all relevant life providers are covered on relevant life policy in trust; this section stays with the Zurich deed from a director’s side.

The form has three boxes. Box A lists the potential beneficiaries, among them the director as “the Member”, a spouse or civil partner, children, grandchildren and great-grandchildren, brothers and sisters and their descendants, and any charity; the director can add other members of their family or household by naming them to the trustees in writing. Box B names default beneficiaries, whose shares must add up to 100%, with at least one person named. Box C holds up to four additional trustees. The company is a trustee automatically, so it is not listed there.

For a limited company, Zurich says it is usual for two officers to sign, and the signature must be witnessed by someone who is neither a trustee nor a beneficiary. The signatories should be the same people who make the application for the policy. The point that most concerns a one-person company is Zurich’s own warning about it: it strongly recommends two or more additional trustees, since a majority must act under some clauses, and for a company with a sole shareholder director “it could be difficult to administer the trust if that sole shareholder director died unless at least two additional trustees had also been appointed.” Who they should be is for the company and its solicitor to decide.

The deed sets limits on its own use. It “must only be used by employers effecting a Zurich Relevant Life Policy and must not be used with any other policies”, and it is not for a policy already in force or one whose proceeds are for the company’s own benefit, such as key person cover. After a death, the trustees choose among the beneficiaries.

What happens if the director leaves the company?

Zurich’s key features give two ways to carry on if the life assured leaves: a new employer takes over the policy and the trust, with no break in premiums, or the trustees assign the policy by deed to the former employee in their own name. Zurich says an assignment ends terminal illness cover and has tax implications, and terminal illness cover also ends sooner once the life assured no longer works for the employer paying the premiums. How that would play out for a particular director is a question for the free call-back. The policy can also simply be ended. Before a director sells the company or steps down, the company’s accountant and solicitor are the people to ask.

The trust notes add a point for a former employee who goes on paying the premiums personally: they should first remove themselves as a beneficiary using a disclaimer form, to avoid an inheritance tax problem Zurich calls a gift with reservation of benefit.

What does HMRC say about the tax, and what are the policy’s limits?

Zurich’s key features say the premiums are “usually viewed as an allowable business expense by HMRC, as long as they meet the necessary legislative criteria”, and warn that the tax benefits “are not guaranteed”; whether they apply turns on your circumstances and on the policy still satisfying HMRC’s rules. HMRC’s manual page on relevant life policies (read 26 October 2026) lists conditions for a single-person policy that include no surrender value and beneficiaries restricted to individuals and charities. That is the general position rather than tax advice, and the rules can change. The full tax detail is on relevant life insurance tax treatment.

Zurich’s policy has no cash-in value. If premiums stop, cover ends and nothing already paid comes back. Cancelling in the first 30 days earns a refund of the premiums paid, and after that none. Under the key features, Zurich can refuse or reduce a claim, cancel the policy or change its terms where questions on the application, an increase or a claim were answered inaccurately or incompletely, where a change before the start or increase date went unreported, or where premiums owed are unpaid. A death by suicide or an intentionally self-inflicted injury within 12 months of the start, or of any increase in cover, is excluded, and the Zurich Relevant Life terms and conditions set out every case where no payment is made. Cover a director buys in their own name, outside the company, is the subject of the Zurich life policy page.

Frequently asked questions

Can a one-director limited company take out a Zurich Relevant Life policy?

Zurich’s key features say shareholding directors can be treated as employees, so a limited company with a single director can be the policyholder. How Zurich would look at one particular application is for the broker to explain.

What is the most cover Zurich allows on a relevant life policy?

Up to 30 times total remuneration at 18 to 39, 20 times at 40 to 49 and 15 times from 50, with remuneration including salary, bonuses, benefits in kind and dividends.

Who receives the money when a director dies?

Zurich pays a lump sum to the trustees, who choose among the people named in the deed. A director can say who they would like, and the trustees will generally follow that wish unless they find a compelling reason not to.

Anyone running a company who wants Zurich’s relevant life cover explained can request a phone call from a broker, free of charge, using this page’s form.

Sources