The Exeter has reported a marked increase in structured arrangements for life insurance payouts since the launch of its beneficiary nomination feature in March 2025.

The new option is proving popular as a simpler alternative to placing policies into trust, particularly among cohabiting couples who make up a growing share of the UK population.

Prior to introducing beneficiary nomination, around 40% of The Exeter’s life insurance policies were written in trust – significantly above the market average of 23%. Since the new option became available, many policyholders have opted to nominate beneficiaries during the application process, helping to streamline claims and avoid probate delays.

Beneficiary nomination allows applicants to name up to five individuals to receive the policy’s payout in the event of their death. These nominations can be amended at any time during the policy term. Like trusts, the mechanism ensures that funds can bypass probate and remain outside the policyholder’s estate for inheritance tax purposes.

Jack Southcott, head of protection propositions at The Exeter, said the change had brought a meaningful shift in client outcomes. “By incorporating beneficiary nomination alongside our wider trust arrangements, we have provided advisers with greater flexibility and more options to help them deliver the best possible outcomes for their clients at the point of claim,” he said.

“Since launching beneficiary nomination in March 2025, we are delighted to see a significant increase in the number of life insurance policies that have a clear and structured arrangement in place for benefit payments. This means that proceeds from a claim can be paid quickly and efficiently to the intended recipients, a small relief at a difficult time.”

The new feature may be especially valuable for unmarried couples, who currently have no automatic entitlement to receive life insurance payouts in the absence of a trust or will. The Exeter notes that cohabiting couples under the age of 45 now account for approximately 40% of couples living together.

Ruth Gilbert, partner at Insuring Change, welcomed the insurer’s efforts to improve outcomes for claimants. “I have been delighted with the whole approach of the team at The Exeter to improving claimant outcomes. Their commitment to making the customer journey as good as it can be has been rewarded with such a good uptake of beneficiary nomination right from the outset,” she said.

“This success puts them amongst the leading insurers when it comes to minimising the ‘beneficiary gap’ for life insurance. For the ever-increasing number of couples who aren’t married, this can mean the difference between receiving the payout intended for them and financial disaster.”