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Pure protection contracts

Originally these did not fall under the FSA rules, but where brought into the rules ion the 14th January 2005 when the IMD became effective.

A pure protection policy is a policy which meets the following conditions,

  1. the benefits under the contract are payable only on death or in respect of incapacity due to injury, sickness or infirmity
  2. the contract provides that benefits are payable on death (other than death due to an accident) only where the death occurs within ten years of the date on which the life of the person in question was first insured under the contract, or where the death occurs before that person attains a specified age not exceeding seventy years
  3. the contact has no surrender value, or the consideration consists of a single premium and the surrender value does not exceed that premium and
  4. the contract makes no provision for its conversion or extension in a manner which would result in it ceasing to comply with any of the above conditions.