Customer Services Centre
Important notice for Canada Life customers
Life Assurance Premium Levy
What is the levy?
The Minister for Finance announced the introduction of a 1% levy on life assurance premiums as part of his budget speech in April 2009. The levy was passed into law under the Finance Act 2009 and applied to all life assurance premiums paid into both new and existing policies on or after 1st August 2009.
After intensive lobbying from the Irish Insurance Federation (IIF) the Minister announced as part of the Finance Act 2010 that the levy would be removed from pension products in order not to discourage investment in this area. Therefore, the levy will be applied on all savings, investment and protection policies, but not pensions, from 1st January 2010.
How is Canada Life applying the levy to savings and investment policies?
Canada Life applied the 1% levy to premiums that were received from 1st August 2009 in respect of policies in force prior to 1st August 2009.
Canada Life, along with other life assurance offices, was not in a position to collect the levy starting in August 2009. This was because significant time and work was required to incorporate the 1% levy into our life office systems. This meant Canada Life started collecting the levy in arrears.
From April 2010 onwards, however, Canada Life will collect the new 1% Government levy as part of your existing payment method by adding it to your premium. Your new premium will include the amount you have been paying plus an extra 1% to cover the cost of the levy payment.
For savings and investment policies taken out on or after 1st August 2009, Canada Life will apply the levy to your policy from 1st April 2010.
How is Canada Life applying the levy to protection policies?
Canada Life has been applying the 1% levy to all protection policies since 1st August 2009.
Frequently Asked Questions
What is the new life assurance premium levy?
The Minister for Finance announced the introduction of a 1% levy on life assurance premiums as part of his budget speech in April 2009. Under the Finance Act 2009, life assurance premiums paid into both new and existing policies on or after 1st August 2009 will be subject to the levy.
The Finance Act 2010, however, removed the levy from life assurance pension policies. The levy remains in place on life assurance protection, savings and investment policies.
Does the 1% levy apply to all life assurance policies?
No. As mentioned above the Minister for Finance removed the levy on pension policies under the Finance Act 2010. It remains in place on life assurance protection, savings and investment policies however.
How long will the levy apply?
Despite intensive lobbying from the Irish Insurance Federation the 1% levy has been passed into law and is to remain in place indefinitely on all life assurance policies (excluding pensions).
Do I have to do anything about this new levy?
No. There is no need for you to take any action or to contact Canada Life. Canada Life will collect the levy from your policy and pay it directly to the government.
Does this just affect my Canada Life insurance policies?
No. The 1% levy is not particular to Canada Life insurance policies. The 1% levy affects all life assurance companies in Ireland.
Who should I contact if I have any further queries about the 1% levy and my policy?
You should contact your financial advisor if you have any further queries about the 1% levy and your policy.
Canada Life Assurance (Ireland) Limited and The Canada Life Assurance Company are regulated by the Financial Regulator.
