Ultra high net worth individuals (UHNWI) are becoming increasingly interested in taking out life insurance policies following the changes announced in 2024’s Budgets, according to Bentley Reid director – wealth management, Mike Winstanley.

Speaking to Wealth Investment News, Winstanley said the firm had seen a sharp rise in the number of UHNWIs interested in life insurance following the proposed changes to trusts, property relief, and the non-dom regime.

“I think the two Budgets last year, taken together, have been a huge catalyst,” Winstanley stated. “Certainly since last March, you can really see the uptick.

“A large amount of these are internationally mobile individuals who either have property in the UK, or they have a significant nexus in the UK, which now means they are more liable to UK inheritance tax than they were before.”

This demand is coming from across the wealth space, including family offices, accountants, lawyers, and other wealth professionals, alongside the clients themselves.

Winstanley noted that it was not just retail or HNW clients - many UHNWIs were now actively exploring whole of life insurance for part of their estate planning.

Bentley Reid, a wealth management firm specialising in advisory services for HNW and UHNW families, first started seeing interest from UHNWIs around three years ago.

“For a 60-year-old couple, seeking a whole of life policy with a 20- or 30-year term, premiums were around 1 per cent or less for whole of life, sometimes as low as 0.1 per cent to 0.2 per cent annually for shorter terms,” Winstanley said.

“At that point, we realised how cost-effective this could be. Since then, we have placed and are structuring multi-million-pound policies for clients with UK and cross-border exposure, often integrating insurance with wider estate or trust planning.”

Winstanley argued that a lot of the plans that had been put in place before the Budget changes were no longer as effective for inheritance tax planning.

“As a result, many clients are revisiting their strategies,” he continued. “The appeal of life insurance is that it doesn’t remove a liability through complex planning - it’s a simple and cost-effective tool to offset it.

“You pay an annual premium, and provided the contract conditions are met, the insurer pays out to cover that liability.”

Looking into whether life insurers can meet this demand, Winstanley noted that life insurers in the UK had not particularly changed their insurance and reinsurance capacities, but they had increased the product range that was available.

“For example, in terms of product offerings, some providers were not previously offering term assurance on a joint life basis, but now they've started to bring do so,” Winstanley added.

“However, for some UHNW clients, their requirements exceed the standard life insurance thresholds. In these situations, we can advise on structuring cover across multiple jurisdictions, often using a combination of term and whole of life solutions held in trust.”

Winstanley highlighted the potential benefits of universal life insurance products for UHNWIs, which he said were only suitable for those with significant inheritance tax liabilities.

“Universal life policies can be particularly effective for UHNW clients with forecasted IHT liabilities and fluctuating liquidity. They offer high coverage and an investment component, which provides flexibility—especially when aligned with evolving family office structures or succession plans.”

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