What is Pension Term Assurance?

Despite what the name might suggest, Pension Term Assurance does not have to form part of a pension.  Pension Term Assurance also known as a Section 785 policy can be used by those not covered by a company pension scheme, to protect their families in the same way as a traditional level term assurance policy.  However with the added benefit of tax relief, they will pay less for their cover.

Who can use this?

Personal Pension Term Assurance is applicable to self employed business people and employees that do not have a pension & Executive Pension Term Assurance is generally for the company directors both provide tax relief 

What is the difference between Personal & Executive?

Personal is paid by the individual and gets tax relief on their rate of tax and Executive is paid by the company and is tax relief using the corporate rate of tax relief 12.5% 

What age can this go to?

Usually to age 65, however with retirement age moved to 68 it would be alright to have it to age 68. If on the other hand you believed you were going to retire at age 60 this would be fine also.

Can it be converted and or indexed?

Yes it can be both indexed and converted, depending on age it would make sense to index it to keep pace with inflation & in the instance whereby it was written to age 60 it would make sense to convert it to a personal policy after retirement.


As a sole trader it makes sense to us pension term assurance to reduce the cost of life assurance and as a director it makes sense to use the company to pay for benefits and get the tax relief.