An employer pension scheme established with a life assurance company for one employee is set up by completing which document?

• A. Declaration of Trust
• B. Form of Indemnity
• C. Letter of Exchange
• D. Appointment of Beneficiaries

Answer: (C)

When an employer sets up a pension arrangement with a life assurance company for a single employee, the arrangement is created as a trust. The document that formally establishes that trust, names the trustees, and sets how benefits are to be paid is the Declaration of Trust. This instrument provides the legal framework for holding the pension assets (the policy) on behalf of the employee and specifies the employee’s rights under the scheme.

The other documents listed do not serve to create the pension arrangement itself: a Form of Indemnity is used for risk/liability related indemnities, a Letter of Exchange is a formal communication about terms rather than the setup instrument, and an Appointment of Beneficiaries designates who receives proceeds but does not establish the scheme’s structure.