GWROB or CLT issues?

I’ve been asked to comment on whether the following arrangement would have any issues from an IHT perspective. The scenario is that parent P effects a term life policy and writes this under discretionary trust and included in the list of beneficiaries are P’s children and their own parent G. G intends to pay the premiums on the policy, the purpose of the policy being that G can act as trustee should P die so that the children of P can be looked after financially. But there is also a desire that G could use the policy proceeds for their own benefit if they so needed. My concern is that if P was paying the premiums, to the extent that they weren’t otherwise exempt they would be chargeable lifetime transfers and I cannot see why this would not also apply to premiums paid by G with the added complication they can also benefit from the trust. I would be grateful to forum members to confirm this or point out if I’m missing something.

Ian Smart
Royal London