When someone dies, get free money and a free will. Every cloud...

9 May 2012

smily deathYou know what you need to cheer you up on a wet Wednesday? An article about death. That’s right, and this really shouldn’t be news to you, but WE ARE ALL GOING  TO DIE. Now, contemplating the death of a loved one is not nice, but what you don’t need at that particular point is  money worries. This is why many people buy life insurance, for themselves or a loved one. But even if the worst comes out of the blue, did you know there is some Government help out there, in the form of free money, if you just know where to look?

If you didn’t know, you weren’t alone. New research from life assurer RGA shows that most consumers are unaware of entitlement to bereavement benefits with only 14% of UK adults aware of the potential benefits available, such as a £2,000 tax-free lump sum.

That’s right, if someone dies having paid National Insurance contributions, then a spouse may be entitled to receive a one off tax free lump sum payment of £2,000. In addition, 85% of respondents didn’t know that, on top of the lump sum, a spouse over 45 may be entitled to receive a taxable weekly benefit of over £100 a week for up to one year from the date of their death.

And if you have children, you could get the £100+ a week benefit  for as long as you can claim child benefit. 83% of people didn’t know that.

The research was commissioned by RGA who, being a life insurer, has a vested interest in worrying you about coping financially after someone dies, so it is nice to see it spreading some good news for a change. These benefits are managed centrally by the Government, so it may also be possible to get access to the funds quicker than any insurance payout.

Simon Grant, claims manager for RGA, said: “These figures confirm our initial fears that these benefits are simply unknown to most members of the general public. The death of a spouse is a life changing event with major emotional, practical and financial consequences. We will continue to work with our clients to advise customers of the existence of these potential benefits as part of the insurance death claim process.”

The full list of bereavement benefits are listed below. If your spouse dies in receipt of a state pension, you may get an increased pension following their death.

Bereavement benefits provide financial assistance for people after the loss of a spouse or civil partner, and comprise:

>    Bereavement Payment: a tax free lump sum payment of £2,000 Recipients must be under State Pension Age, and the deceased spouse/partner must have made National Insurance contributions, and  was not entitled to a Category A state retirement benefit when they died
>   Bereavement Allowance: a taxable weekly benefit of up to £100.70 per week paid for up to 52 weeks from the date of death. Recipients must be over age 45 but under State Pension Age, with no dependent children, and the deceased spouse/partner must have made National Insurance contributions or died as a result of their job
>    Widowed Parents Allowance: a weekly benefit of up to £100.70 a week
Recipients must be bringing up a child or children under age 19, under State Pension Age, and the deceased spouse/partner must have made National Insurance contributions or died as a result of their job
>    Funeral payment: a payment of up to £700 Recipients eligibility will be subject to means testing, and will depend on the relationship with the person who died

And if all this talk has got you really excited about dying, why not make a Will? For free! Various charity schemes, like those supporting Cancer Research UK and Marie Curie are available, as well as WillAid which runs every November (or Will Relief Scotland in September). There is no obligation to leave a donation to the charity in your Will, but the charity will have to pay those money-grabbing solicitors who nothing in this world for free*, so it may rest heavy on your conscience** if you don’t. Alternatively, if you actually pay for a bank account (there are such people about), accounts like the Barclays Additions Active and Barclays Premier Life include a free will.

*no offence Len

** for those struggling to place their conscience, it looks like Jiminy Cricket

TOPICS:   Health   Economy   Insurance


  • Richard
    The information about allowances is on the form given to you when the death is registered. Given that most of those deaths - possibly 86% - will be people over pension age it's not surprising most adults are unaware.
  • JonB
    "if you actually pay for a bank account" Surely that should read "if you actually pay an additional fee for a bank account" as everyone pays for their account somehow - mostly due to lost interest.
  • Oedipus
    Do I still get the money if I kill them myself?
  • Mike H.
    Oh joy, all the chavs will be knocking off their 'G-Ma' to get their grubby hands on some loot to go to Sportsdirect to get some fancy new clobber.

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