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Life Savings Insurance

Our 30 Day Notice and Secured Savings accounts include free life savings insurance. If you die while you have savings in one of these accounts, your beneficiary can ask us to make a life savings insurance claim, to increase the money in your savings. We will pay the insurance settlement, along with your savings, to your beneficiary.

Life savings insurance is separate from the Financial Services Compensation Scheme (FSCS), which protects your savings in the event of the failure of Sheffield Credit Union. More details about FSCS protection.

What do I need to do?

  • Money you save in your 30 Day Notice account is automatically insured.
  • Only money that you save before your 80th birthday is covered.
  • Please make sure you have told us who your beneficiary (next of kin) is. We will ask you this when you join, and you can contact us to check and update your details.
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Who provides the insurance?

  • Sheffield Credit Union have a contract with CMutual, who provide the life savings insurance.
  • All insurance claims are assessed by CMutual, so we cannot guarantee whether or not they will accept a claim.
  • There are some circumstances in which we cannot make a claim.

How much insurance will my beneficiary receive?

If your beneficiary asks us to make a claim, we will split your savings into three pots:

  • Money that you saved before your 65th birthday
  • Money that you saved on or after your 65th birthday, but before your 80th birthday
  • Money that you saved on or after your 80th birthday

To calculate the amount of the insurance settlement, our insurers will take 100% of the amount you saved before turning 65, then they will add 25% of the amount you saved between turning 65 and turning 80. Money you saved from your 80th birthday onwards is not covered by the insurance.

The maximum settlement is £5,000.

Insurance calculation examples

Example 1: Simple example

Lindiwe saved £1,000 before turning 65, then another £400 by the time she turned 80. Her total savings balance when she died was £1,400.

 

If Lindiwe's partner decides to claim on the insurance, the settlement will be made up of:

100% of the money saved before age 65: 100% of £1,000 = £1,000

25% of the money saved before age 80: 25% of £400 = £100

 

Lindiwe's partner will receive the insurance settlement (£1,100) and the balance of Lindiwe's savings (£1,400), for a total of £2,500.

Example 2: Example showing the maximum settlement amount

Anita saved £4,800 before turning 65, then another £2,000 by the time she turned 80. Her total savings balance when she died was £6,800.

 

If Anita's children decide to claim on the insurance, the settlement will be made up of:

100% of the money saved before age 65: 100% of £4,800 = £4,800

25% of the money saved before age 80: 25% of £2,000 = £500

The total is £5,300. Because this is more than £5,000, the settlement will be capped at £5,000.

 

Anita's children will receive the insurance settlement (£5,000) and the balance of Anita's savings (£6,800), for a total of £11,800.

Example 3: Complex example

Rob saved £6,000 by the time he was 65. When he was 67, he withdrew £5,500; so out of the money he saved before turning 65, £500 is left. He then saved another £3,000 by the time he turned 80, and another £300 after that. His balance when he died was £3,800.

 

If Rob's next of kin claims on the insurance, the settlement will be made up of:

100% of the money saved before age 65: 100% of £500 = £500

25% of the money saved before age 80: 25% of £3,000 = £750

The £300 Rob saved after turning 80 is not covered by insurance.

 

Rob's next of kin will receive the insurance settlement (£1,250) and the balance of Rob's savings (£3,800), for a total of £5,050.

What happens if I have a loan outstanding?

If you have a loan outstanding when you pass away, we will use your savings and the insurance settlement to pay off your loan, and everything that is left will go to your beneficiary.

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