TRUSTS IN LIFE POLICIES
The law allows for the automatic creation of trust in a life policy : i) Civil Law Act 1956, in particular, Section 23 ii) Financial Services Act 2013, Schedule 10 The rationale is: (i) to provide the married man or woman with a simple method of making some financial provisions for his/her spouse & children on his/her death ; (ii) to ensure that such a provision remains even if the insured was heavily in debt or bankrupt at the time of his/her death. However, the statutory trust policy money would not be created favouring a Muslim who nominates his wife, children or parent as nominees. A nominee of a Muslim policy owner receives the policy money as an executor & must distribute the funds in accordance with Islamic Law