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How to Put Life Insurance in TrustStep-by-Step Guide
A practical step-by-step guide to writing your life insurance policy in trust. Protect your family from 40% inheritance tax and bypass probate delays.
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Book a Free ConsultationKey Facts: How to Put Life Insurance in Trust
A practical guide to putting your life insurance in trust — usually free, usually simple, and potentially saves your family thousands in inheritance tax.
- -Most insurers provide trust forms free of charge
- -The process typically takes 10-15 minutes
- -You need to choose trustees (usually 2 people you trust)
- -You need to name beneficiaries (who you want the money to go to)
- -Bare trusts are simpler; discretionary trusts are more flexible
- -Once in trust, the policy cannot easily be moved back out
How to Put Life Insurance in Trust: Step by Step
1
Check if Your Insurer Offers Trust Writing
Most UK life insurers provide trust forms free of charge. According to Reassured, digital forms are now standard and the process takes minutes. Check your insurer's website or call them.
2
Choose Your Trust Type
Bare trust (absolute): simpler, named beneficiaries have a fixed right. Discretionary trust: trustees decide distribution. See our life-insurance-trust-inheritance-tax guide for the IHT implications of each.
3
Choose Your Trustees
You need at least 2 trustees. These are the people who will manage the trust and distribute the payout. Choose people you trust completely — usually family members or close friends. You can also appoint a professional trustee (solicitor).
4
Name Your Beneficiaries
For a bare trust: name the specific people who will receive the money. For a discretionary trust: name the class of potential beneficiaries (e.g. your spouse, children, grandchildren) and write a letter of wishes.
5
Complete the Trust Deed
Your insurer provides the trust deed form. Complete it, sign it, and return it to the insurer. No solicitor is required for standard insurer-provided trusts. Keep a copy for your records.
Do I Need a Solicitor?
For standard life insurance in trust using your insurer's own forms, you do not need a solicitor. However, Kreston Reeves recommends professional advice if:
- Your estate is above \u00a31 million
- You have a complex family situation (second marriages, children from multiple relationships)
- You want a bespoke discretionary trust rather than the insurer's standard form
- You have business interests that interact with the trust
For business policies, trust arrangements are more complex. Relevant life insurance trusts and shareholder protection cross-option agreements typically benefit from professional guidance.
Trusted Sources & Further Reading
This how to put life insurance in trust guide references:
- HMRC Inheritance Tax
- Reassured — Process guidance and digital forms
- Kreston Reeves — When to seek professional advice
- HMRC Trust Tax Return Guide 2025
- MoneyHelper
How To Put Life Insurance In Trust FAQs
Is it difficult to put life insurance in trust?
No. Most insurers provide trust forms online or by post, free of charge. The process typically takes 10-15 minutes. No solicitor is required for standard insurer-provided trusts.
How many trustees do I need?
At least 2 trustees. Choose people you trust completely — they will be responsible for distributing the payout. Family members, close friends or a professional trustee (solicitor) are common choices.
Can I put an existing life insurance policy in trust?
Usually yes. Contact your insurer and ask for a trust assignment form. They will transfer the existing policy into trust. Some older policies may have restrictions, so check with your provider.
What is a letter of wishes?
A non-binding letter to your trustees explaining how you would like the trust payout distributed. Used with discretionary trusts where the trustees have flexibility. Update it when your circumstances change.
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We are a comparison and information resource, not an insurer or broker. For regulated advice, consult a qualified professional.