What Happens to a Royal London Pension When Someone Dies?

What happens to a Royal London pension when someone dies?

1Royal London pension death benefits bypass probate — they are paid at the trustees' discretion to nominated beneficiaries, not under the will
2As a defined contribution provider, the full fund value is paid out; options include lump sum, income drawdown for beneficiaries, or annuity
3The nomination form registered with Royal London determines who is considered — trustees have discretion but usually follow a valid nomination
4If the member died before age 75, payouts are normally tax-free; if after 75, the recipient pays income tax at their marginal rate
5From April 2027, unspent Royal London pension funds will be counted in the estate for inheritance tax — a major change for policy holders

Royal London is one of the UK's largest mutual life, pensions, and investment companies, offering personal pensions, workplace pensions, and self-invested personal pensions (SIPPs). When a Royal London pension member dies, their beneficiaries can claim the fund value. These funds fall outside the estate and generally do not require probate.

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Does a Royal London Pension Require Probate?

In most cases, no. Royal London pensions are set up as discretionary trusts, which means the fund falls outside the deceased's estate. Royal London can pay the fund value directly to the nominated beneficiary without a Grant of Probate.

If there is no nomination and Royal London cannot identify an appropriate beneficiary, they may pay the fund to the estate. In that case, probate may be required before the funds can be distributed to beneficiaries.

What Death Benefits Does Royal London Pay?

Royal London offers several types of pension, each with slightly different death benefit options:

Personal and Workplace Pensions (DC)

The death benefit is the full fund value at the date of death. Royal London may offer beneficiaries the option to receive this as:

A lump sum — paid directly to the beneficiary
Inherited drawdown — the fund is transferred to a pension in the beneficiary's name, allowing flexible withdrawals
An annuity — used to purchase a guaranteed income

Which options are available depends on the specific policy terms. Royal London will explain the available options when you contact them.

SIPPs

Royal London also offers SIPPs. For a deceased SIPP holder, the same discretionary trust rules apply — the fund is paid to the nominated beneficiary outside the estate. See our guide to SIPP death benefits for more context.

How to Claim Royal London Pension Death Benefits

Contact Royal London's bereavement team. Call 0345 605 5678 or visit royallondon.com/bereavement. Have the deceased's policy number or national insurance number ready.
Provide a certified copy of the death certificate.
Royal London will review the nomination. If a valid nomination is registered, they will contact the nominated beneficiary and explain the options available to them.
Choose how to receive the benefit. Depending on the policy, beneficiaries may be able to choose between a lump sum, inherited drawdown, or annuity.

The Nomination Form: Why It Matters

Royal London asks all pension holders to complete a nomination of beneficiary form (expression of wishes). This tells Royal London who the member would like to receive the fund. Royal London's trustees will consider this nomination when deciding who to pay, but they retain discretion — they are not legally bound to follow it.

This discretionary structure is essential — it is what keeps the fund outside the estate for IHT purposes. In practice, Royal London almost always follows a valid, current nomination.

Members should update their nomination after any significant life event. Royal London makes this easy — it can be done by phone, post, or through a financial adviser.

Tax on Royal London Pension Death Benefits

Death before age 75: Lump sums and inherited drawdown payments are normally tax-free for the recipient, subject to the lump sum and death benefit allowance.
Death at age 75 or over: All payouts are taxed as income for the recipient at their marginal rate.

Royal London will advise on the tax position at the point of payment. For the latest rules, see GOV.UK's guidance on tax on pension death benefits.

IHT and Royal London Pensions From April 2027

Currently, Royal London pension funds fall outside the estate and are not liable to inheritance tax. From 6 April 2027, unspent pension funds — including Royal London pensions and SIPPs — will be brought within the scope of IHT. This is a fundamental change to pension taxation.

Read our detailed guide to pensions and inheritance tax from April 2027 and review the current inheritance tax rules for 2026/27.

If There Is No Nomination Form

If no nomination of beneficiary is on file, Royal London will use their discretion to identify the most suitable beneficiary. They will typically consider whether there is a surviving spouse, civil partner, or financially dependent person. If no suitable beneficiary is found, the fund may be paid to the estate and become subject to probate and estate administration.

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