In a nutshell, the master trust is a legal arrangement which allows a professional company to look after the proceeds of any claim. Its role is to invest the insurance proceeds and ultimately administer them to the beneficiaries of the insured.

The big advantage of placing a life insurance policy in a trust is that it doesn’t form a part of the policyholder’s estate when they pass away, and therefore doesn’t incur inheritance tax.

It also makes for a faster payout and allows the policyholder to name a specific person or persons who should benefit from the money and how it should be paid when the time comes.

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