RL360 LifePlan

The Isle of Man, one of the worlds leading offshore financial jurisdictions, offering international clients scope for tax efficiency.

Isle of Man has an outstanding reputation for investor protection and supervision, resulting in an AA+ risk rating from Standard & Poor’s (as at November 2012) and an AAA rating from Moody’s (as at November 2010).

Policyholders are protected by the Isle of Man Compensation of Policyholders protection scheme.

However, this does not necessarily protect individual investors from poorly suited products.

LifePlan aims to pay a cash sum on the death or diagnosis of a defined terminal illness of the life assured.

• If selected at the beginning of the policy, LifePlan aims to pay a cash sum if the life assured is diagnosed with a covered critical illness or undergoes a covered medical procedure.

There are a few: -

The charges RL360 deduct from your policy may be higher than those shown in your Personal Illustration.

If that happens you may have to increase your premium payments to maintain the chosen benefits.

Future charges may also be higher than those shown in your Personal Illustration.

For example, premium collection charges may change, or switch charges may be imposed at a later date.

If the investment return is less than that expected by you and your financial adviser, you may have to increase your premium payments to maintain the chosen benefits.

If you choose not to increase your payments and your policy value runs out your benefits will cease.

The value of your policy is linked to your chosen investment funds, whose value may fall as well as rise and is not guaranteed.

If you stop paying your premiums early your cover may cease.

If you take a premium holiday and your policy value drops during that time, your benefits may be at risk.

If you change occupation or move country this could affect the level of premiums you need to pay.

Cover may not always be available for certain high risk jurisdictions or occupations.

The benefits of LifePlan are split into three different categories.

These are Core Benefits (mandatory), Additional Benefits (these can be added onto the policy at an additional cost) and Added Extras (these are added onto the policy at no additional cost).

The benefits are as follows:

Core benefits

Primary life cover Life cover is the core benefit offered by LifePlan.

On the death of the life assured, a cash sum will be paid out.

The initial maximum sum assured is USD7,500,000 (or currency equivalent).

Additional benefits

Accidental death benefit

Accidental death benefit doubles the amount of life cover (both primary life and term) that is in force up to an initial maximum of USD500,000.

It is paid should the life assured die in an accident, or up to 90 days after due to any injuries sustained.

Critical illness cover

Critical illness cover will advance a portion of the sum assured if the life assured is diagnosed with a covered critical illness or undergoes a covered medical procedure.

Any amount can be selected between USD45,000 and the maximum of USD750,000 (or currency equivalent) at time of issue.

The maximum age at entry for critical illness cover is 59.

The waiting period before this benefit starts is 90 days after the policy is issued.

Term critical illness cover

Term critical illness cover allows the policy owner the option of purchasing critical illness cover so long as the policy owner has already purchased the term life cover.

The minimum and maximum amounts that can be taken are the same as the whole of life critical illness cover.

Term life cover

The policy owner can buy additional coverage on a term basis to cover any short term needs.

Any amount can be selected up to the maximum value of benefits of USD7,500,000.

This benefit is available on a limited term of between 5 and 61 years, although coverage cannot be extended beyond the life assured’s 80th birthday.

Waiver of premium benefit

While the life assured is injured or taken ill and unable to work in either their own or another suitable occupation for more than 6 months, waiver of premium will keep the cover going by paying the premiums automatically.

This benefit terminates at age 65 or the end of the premium payment term if earlier.

Added extras

Total and permanent disability

If critical illness cover is purchased for the life assured, the policy will also cover the life assured should they become totally and permanently disabled, and as a result are unable to return to any form of paid employment.

Long term care

If the life assured takes out critical illness cover; after the age of 65 the policy will cover the life assured should they need help carrying out their normal day to day activities.

Terminal illness benefit

Should the life assured be diagnosed with any illness that will lead to death within 12 months the sum assured will be paid out in advance.

Passive war cover

There is no exclusion for passive war risks. This means that if the life assured were the innocent victim of an act of war or terrorism then RL360 would consider the claim.

Repatriation benefit

In the event of the death of the life assured in a country other than their home country, LifePlan will pay out an immediate advancement of USD7,500 (or currency equivalent) of the sum assured to help with any associated costs.

Children’s critical illness cover

Where critical illness cover is purchased for the life assured, RL360 include up to 3 of their children for critical illness cover, provided they are in good health and between 1 and 18 years of age.

RL360 include up to USD15,000 of coverage free of charge.

Aeroplane cover

If the life assured dies as a fare-paying passenger on a commercial airline, RL360 double the effective primary life cover up to USD1,000,000 in addition to the sum assured.

This benefit has no cost to the policy owner.

Benefit indexation option

All whole of life related benefits (such as primary life and critical illness cover) can be indexed at a simple annual rate of either 5% or 10%.

If this option is selected, premiums must be indexed by at least the same percentage.

Premium indexation option

Policy owners can choose to increase their premiums at a simple annual rate of either 5% or 10% to increase their contributions to the fund values.

Guaranteed insurability option

LifePlan will expand with your family’s growing protection needs.

Upon notification that new members have joined your family, either through marriage or through birth, RL360 will increase the size of your sum assured.

There is no need to undergo further medical testing.

Temporary accidental death benefit

This benefit will provide temporary cover from when RL360 receive the completed application form and valid method of payment until you are in safe receipt of the policy schedule.

If the life assured were to die in an accident before the policy documentation is issued, RL360 would pay out a lump sum of up to USD75,000 (or currency equivalent).

Vanishing premium option

Policy owners can choose to pay for the policy over a specified period of time. This is often referred to as a vanishing premium term.

The option allows them to select how long they want to be paying premiums for.

Benefits can be indexed even if they are being paid for on a vanishing premium basis.

You can take a break from paying premiums as long as the value of the policy is at least twice the total annual premium.

Your policy will need to have sufficient value to fund the entire premium holiday that you are taking, otherwise the benefits may be at risk.

The charges for coverage will continue and premium payment will need to be restarted after the premium holiday ends.

After allowing for charges, your money is invested in the funds of your choosing, from a range of UK authorised and international collective investment schemes.

A full list of available funds can be found in the LifePlan Investment Guide.

You can currently switch between funds free of charge and redirect future premiums into new funds whenever you want.

Under LifePlan you may hold up to 5 individual investment funds at any one time.

You can cash in part of your policy provided that the then remaining policy value is at least USD15,000.

You can also cash in your entire policy at any time after which your benefits will cease.

The costs of setting up LifePlan are paid over the course of the first 2 years by not allocating your premiums to units.

From years 3 to 10 inclusive, 94% of your premiums are allocated to your policy.

From year 11 onwards 98% of your premiums are allocated to your policy.

There is a monthly maintenance fee which is currently USD7.50 for standard policies.

The amount will increase every year on the policy anniversary in line with the Isle of Man Retail Price Index.

For children’s plans, a monthly policy maintenance fee of USD15 (or currency equivalent) is deducted.

This fee continues at this rate over the lifetime of the policy, increasing every year on the policy anniversary in line with the Isle of Man Retail Price Index.

If a single premium injection is made 93% of the premium is allocated to your policy.

The cost of the life cover and any other benefits chosen are deducted from the value of your policy, on a monthly basis in advance.

The cost of providing benefits can be influenced by various lifestyle factors.

Your Personal Illustration takes into consideration any costs associated with providing these benefits.

A policy charge which is currently 0.25% of fund value is also payable each year on a quarterly basis in arrears.

An individual benefit charge may also be assessed depending on the different benefit selections you may make.

The fund(s) that are held within the Policy are subject to an annual management charge. The charge is levied by the external Fund Manager and will vary according to the fund chosen.