Life insurance can give you much needed peace of mind when it comes to protecting your family’s financial security should the worst ever happen to you but finding the right policy can be time consuming.

With, looking for life insurance quotes is simple and quick and because you can see a range of plans from different providers, you can compare prices and features at a glance.

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  • Do I need life insurance?
  • When should I get life insurance?
  • I have a family, tell me about life insurance
  • I have a mortgage, tell me about mortgage life insurance
  • I’m over 50, tell me about over 50s plans

Jump to section

  • Do I need life insurance?
  • When should I get life insurance?
  • I have a family, tell me about life insurance
  • I have a mortgage, tell me about mortgage life insurance
  • I’m over 50, tell me about over 50s plans

What is life insurance?

Life insurance policies pay out a lump sum (known as the ‘sum insured’) when the policyholder passes away. There are several different types of policy and the right one for you will depend on a number of different things, for example:

  • How much cover you want
  • Whether you want the sum insured to cover a specific debt (like a mortgage)
  • How much you can afford to pay in premiums each insurancemonth

How does life insurance work?

Policies work in different ways depending on the plan you have. Broadly speaking, there are two main types of life insurance – term and whole-of-life policies.

Term policies cover you for a fixed length of time (known as the policy term). The most popular term policies are:

  • Level term cover where the amount of cover is also fixed so it doesn’t matter when you pass away, as long as you do so within the policy term, the amount of money paid out is the same.
  • Decreasing term where the amount of cover gets smaller in time, usually in line with a specific debt (like a mortgage or car loan). For example, if you had a 25-year plan then your dependents would receive more money if you passed away in year five than they would if you died in year 20.

Other types of term policy are available and you may find they suit your needs better, for instance – increasing term, convertible term and renewable term cover. 

In contrast, whole-of-life policies have no fixed term and cover you for the entirety of your life. As you’d expect, these policies tend to be more expensive than term cover because there is no policy end date. They do, however, guarantee beneficiaries a lump sum payment when you pass away (subject to any conditions set out in your policy).

Life Insurance FAQs

Do I need life insurance?

If anyone relies on you financially, then life insurance is definitely worth considering. Leaving a lump sum payment means loved ones could pay off the mortgage and stay in the family home – easing their financial burden at a time of grief.

When should I get life insurance?

If you don’t have dependents, aren’t wanting to leave your property to anyone or don’t have a mortgage, then you may not need life insurance but your circumstances may change.

With that in mind, it’s worth knowing that life insurance becomes more expensive as you get older because of the associated decline in health, so while buying a policy in your twenties might feel premature, it can be far more cost-effective than buying one in your forties.

I have a family, tell me about life insurance

On the whole, family or personal life insurance is simply another way of describing a life insurance policy that you’ve taken out to benefit your loved ones.

Other policies that are specifically aimed at families include something called Family Income Benefit (FIB). These are usually sold as term policies but are slightly different in the sense that they pay out regular instalments to your loved ones rather than a lump sum payment.

I have a mortgage, tell me about mortgage life insurance

Mortgage life insurance is a policy that covers the cost of your remaining mortgage loan.

One of the main types of mortgage life insurance is decreasing term cover and the two names are sometimes used as one and the same. Decreasing term policies are only suitable if you have a repayment mortgage as the amount you owe gets smaller in time (as does the sum insured).

If you have an interest only mortgage then a level term cover policy is an option worth considering as the sum insured remains the same throughout the policy term.

You can also buy mortgage payment protection insurance which is a slightly different type of plan that pays out regular installments if you become sick, injured or are made redundant.

I’m over 50, tell me about over 50s plans

As the name suggests, you need to be at least 50 to buy an over 50s plan. They work in a similar way to other life insurance products as they pay out in the event of your death but they do have some key differences:

  • Guaranteed acceptance no matter what your lifestyle and state of health is and there is no medical.
  • Guaranteed payout when you pass away whereas claims for life insurance will need to meet all the policy conditions.
  • Fixed premiums for the length of the policy which can be good for budgeting.

For more information and a look at the various pros and cons read our guide on how to compare over 50s life insurance.

Find out more about life insurance

When it comes to life insurance, there’s a lot to think about and it’s well worth considering all the options to ensure you find the policy that best meets your needs. To help you make a more informed decision based on all the facts, we’ve put together Life Insurance Explained which aims to answer all the questions you might have, such as:

  • Should I get a single or joint policy with my partner?
  • How do I work out how much cover I need?
  • Do I need life insurance to get a mortgage?

While it’s hard to pinpoint the average cost of life insurance in the UK, we’ll also explore what factors make up your premium so you can be clear on exactly how life insurance premiums are calculated (which could give you some ideas about how to lower the cost).

Before you decide to buy any policy, make sure you’re completely happy with all the terms and conditions set out as different providers will have their own variations – even if plans share the same name.

You’ll also need think about what you expect in terms of levels of service. Some initially cheap life insurance deals could end up costing you more if you want to make any amendments to your policy, so find out what admin fees there are and what they’re charged for.

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