why have a trust?
The main reasons for writing a policy in Trust are as follows
Speed
If a policy is on a single life basis, the policy will not pay out until probate (or confirmation in Scotland) is granted on the estate. This can sometimes take time. If the policy had been written in Trust, the funds do not go into your estate and the Trustee can obtain the proceeds immediately.
Tax Planning
When a policy which has not been written in Trust the proceeds go into your estate and as a result, depending on the value of the estate the policy proceeds may be subject to inheritance tax. If a policy is written in Trust then the proceeds can be paid directly to the Trustee for the benefit of the beneficiaries without going into your estate & would not usually be subject to inheritance tax.
Certainty
When a Trust is set up you ensure that who you wish to receive the benefits of a policy on your death definitely does. Because the proceeds don’t go into your estate, they are paid directly to the Beneficiaries via the Trustee.