986. Exclusion of reservation of benefit provisions.

The reservation of benefit provisions1 do not apply if or to the extent that the disposal of property by way of gift2 is an exempt transfer by virtue of certain provisions3. In addition, they do not apply if the disposal of property by way of gift is made under the terms of a policy issued in respect of an insurance made before 18 March 1986 unless the policy is varied on or after that date so as to increase the benefits secured or to extend the term of the insurance4.

In the case of a gift, which is an exempt