Being frank about your finances is important in any relationship. But cohabiting couples in particular, who do not have the same legal protections as those who are married or in civil partnerships, need to know where they stand should one of them die or the relationship break down.

A recent report noted that 46% of people wrongly assume cohabitees are in a ‘common law’ marriage. This concept doesn’t in fact exist in UK law. The government recently rejected calls to boost legal rights for cohabiting couples, although unmarried people are now entitled to claim bereavement benefits should their partner die.

This change still means cohabiting partners do not inherit assets tax-free if their partner dies – unless the estate is under £325,000 and left to them in a will – and may not inherit anything at all if there is no will. They may also not be in line to receive funds from pensions or life insurance policies. Couples who have children together or co-own their home need to plan their finances carefully.

Surprisingly, research by Scottish Widows found that only half (52%) of unmarried adults in a relationship knew whether or not their partner had a life insurance policy.

Starting a discussion involving the three steps below should ensure partners have some protection in place, whatever the future holds.

• Check property ownership: Ensure you know whether your property is owned as a ‘joint tenancy’ or ‘tenancy in common’ and whether the arrangement will meet your needs if one of you dies.
• Write a will: these can be individual or ‘mirror wills’ for couples, setting out who inherits assets or looks after any children in the event of one or both partners dying.
• Nominate your partner as a beneficiary on your pension or life insurance policy: This generally involves completing one form, often online.