Hi
SAIM2430 advises Interest arising on an account held by an unmarried person under 18 is treated as income of his or her parent if the money in the account was a gift from the parent and the interest exceeds £100 -
SAIM2430 - Interest: taxation of interest: children's accounts
As the children are now over the age of 18, the capital and interest is theirs. The insurance company will be able to confirm whether the payment can be paid directly to your children.
The insurance company will provide chargeable event certificates, showing the gain arising on the policy for each child.
If the gain exceeds £10000.00, then a tax return is required to report the gain. If below this figure, your children should send a copy of the chargeable event gain to:
H.M. Revenue and Customs
Pay As You Earn
BX9 1AS.
Thank you