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Trusts, deeds and rules.

Your guide to trusts, deeds and rules

Important

The documents we refer to in this guide are for use with the group death in service cover we provide.

The trusts, rules and deeds we provide are examples of documents you can use to set up and update your scheme. We’ve designed them to be executed in the UK in line with English Law.  You do not have to use our examples, and can change them to suit a specific need or even use your own.

Our example deeds have been written to update schemes set up using our example trusts and rules.  These deeds may not be suitable if your scheme has been set up differently, or if you have chosen to change our examples.

Before you execute one of these documents you need to make sure it meets your needs, and we recommend you talk to your legal adviser to find out if it is suitable.  You will be responsible for any legal fees you incur.

Don’t forget to tell us if you are changing the scheme.  The policy may need to be updated to continue to meet your needs.  Changes to the policy can be made from a current or future date and terms may apply.

For policies covering employees
The changesDocuments needed
Setting up a new scheme for a new policy.
  1. Declaration of trust (to set up the new scheme).
  2. Supplemental deed of adherence (to include any other employers).
  3. Scheme rules.
Including a new participating employer.Supplemental deed of adherence.
Changing the scheme name.Supplemental deed of amendment.
Principal employer has changed its name and also wants the scheme name updated.Supplemental deed of amendment.
Principal employer has changed its name but doesn’t want to change the scheme name.None. 
Principal employer is replaced by a new principal employer.Deed of amendment. 
Moving the policy from one scheme to another where the new scheme has already been set up.Deed of assignment.
Moving the policy from one scheme to another the employer is setting up using our example documents.
  1. Declaration of trust (to set up the new scheme).
  2. Supplemental deed of adherence (to include any other employers).
  3. Deed of Assignment (to transfer the policy from the old scheme to the new scheme).
  4. Scheme rules.

Visit the literature section to download trusts, deeds and rules.

For policies only covering equity partners or Limited Liability Partnership members in a non registered scheme
Your changesDocuments needed
Setting up a trust to describe how benefit will be paid.Declaration of trust.
The firm is being wound up and replaced by another (for example a Limited Liability Partnership replaces an equity partnership).Deed of appointment retirement and assignment.

Visit the literature section to download trusts and deeds.

General information on trusts, deeds and rules.
Declaration of trust

This is used to record how, and to who, benefits from a death in service policy will be paid.  Where the benefit is paid for employees, it can also sets up the scheme.  If the scheme is to be registered with HMRC, the scheme administrator will only be able to do this once the employer has formally set the scheme up.

We have different versions of trusts to choose from depending on:

  • the type of scheme and policy the policyholder wants;
  • the set up of the business (is it a limited company,  equity partnership or Limited Liability Partnership); and
  • whether trustees are to be appointed or if the business is to act as a corporate trustee.
  • if the benefit is to be used as business protection or to be payable to dependants.

 

If your client is setting up a scheme for their employees, our new declaration of trust examples also have scheme rules attached.  These are generic scheme rules that should not need regular updates.

Contact us if you cannot find the version you need.

Visit the literature section to download trusts, deeds and rules.

Scheme rules for registered schemes

These describe who is eligible for benefit, what circumstances trigger benefit payment and who will receive the benefit. Scheme rules may be updated by adopting an addendum, or a replacement set of scheme rules.

Our new declaration of trust examples have scheme rules attached.  These are generic scheme rules that should not need regular updates.

Visit the literature section to download trusts, deeds and rules.

Supplemental deed of adherence

A policyholder can use this to include the employees of another employer under your scheme.  It records:

  • the principal employer’s agreement to let the new employer participate;
  • the new participating employer’s agreement to keep to the scheme rules; and
  • the date the new participating employer joins.

We have different examples of this deed depending on the set up of the employers (for example limited company or partnership).  Contact us if you cannot find the version you need.

Visit the literature section to download trusts, deeds and rules.

Supplemental deed of amendment (used to update the declaration of trust)

This is used to change the scheme name.  We have different versions of this deed depending on the set up of the principal employer’s business (is it set up as a limited company, equity partnership or Limited Liability Partnership).

Visit the literature section to download trusts, deeds and rules.

Deed of amendment

This is an agreement between two different employers where one is replacing the other as the principal employer (the employer who sponsors the scheme).  The new principal employer can also use the deed to update the scheme name at the same time.

We have different versions of this deed. Some completely remove the old principal employer while others allow them to still be included as a participating employer.  Contact us if you cannot find the version you need.

Visit the literature section to download trusts, deeds and rules.

Deed of assignment

This is used when the policy is to be transferred to cover the benefits of a different scheme (and the benefits of the old scheme are no longer to be covered).

For example, our policy may be covering the death in service benefits of a pension scheme the trustees have decided to wind up. To continue the death benefits for their employees, the principal employer is setting up a new death in service scheme.

They now need us to move the policy from the old pension scheme to the new death in service scheme.

The deed is an agreement between the old scheme trustees (the old policyholder) and the new scheme trustees (the new policyholder). It records the date of the change and the policies affected. The new trustees also agree to keep to the policies’ terms and conditions.

There are different variations of the trust depending on the set up of the schemes.  For example some deeds cater for corporate trustees and others for appointed trustees.  Contact us if you cannot find the version you need.

Visit the literature section to download trusts, deeds and rules.

Deed of appointment retirement and assignment (for policies only covering partners)

This is used where an equity partnership is being wound up and replaced by a Limited Liability Partnership (LLP).  Our deed is an agreement between the old equity partnership and new LLP.  It allows the new LLP to take over the trust and policy from the old partnership.

Visit the literature section to download trusts, deeds and rules.

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