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HMRC internal manual

Inheritance Tax Manual

Life Policies: definitions: 'claim value'

The ‘claim value’ is the amount payable by the insurance company when a claim is made on the policy. Typically this is when the life assured dies. The claim value will usually constitute the open market value (IHTM20083), but may not in certain circumstances.

For example, in the case of unit-linked policies, the claim value normally relates to the value of the relevant units at the date the insurance company receives notification of death. As this notification is almost always received after the death the value of the units may have gone up or down, affecting the actual claim value that is paid out. For Inheritance Tax purposes the value required is the claim value at the date of death. That is the amount that the insurance company would have paid out if they had received notification of the deceased’s death on the day they actually died.

The claim value may also be subject to a discount (IHTM20212). See IHTM20211 for further information.