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Life insurance

Compare life insurance quotes from a range of providers to find a policy that could give your loved ones a lump sum when you die.

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Last updated: 19 January 2021

What is life insurance?

Life is uncertain and anything can happen. We should be prepared for the worst, just in case.

The best life insurance can give you peace of mind, because it will give your loved ones a payout if you die during the policy’s term. Having a lump sum would help your family manage the finances when you’re gone.

Do you need life insurance?

Payouts from life insurance companies can help cover any financial commitments you have, which may fall on your family if you die.

They could use the payout for mortgage payments, school or university fees. Or it could be used for repaying outstanding debts and recurring expenses. Otherwise, it could just be money for them to live off or enjoy.

Once you’ve decided whether you need life insurance, you can start looking for the best life insurance for your needs.

How does a life insurance policy work?

Life insurance pays out a lump sum payment to your family, or whoever you name on the policy, if you pass away during its term.

For the lump sum to be paid, you’ll need to meet the provider’s terms and conditions and pay your monthly premiums.

The best life insurance, UK wide, usually only covers you for death. You’ll need a different type of income protection – such as critical illness cover – if you want cover for illness or disability.

Every life insurance policy has its own terms and exclusions. But even the best life insurance companies usually don’t pay out if you die due to suicide, a drug overdose or as a result of a risky or reckless act.

When you compare life insurance, you’ll be able to find life insurance quotes for the life cover you're looking for.

Which type of cover is the best life insurance?

There are several types of life insurance. They offer different levels of cover to suit your needs.

You’ll need to find out about each to work out which type of cover is the best life insurance for you. Some of the most common types are:

Level term life insurance: This is the simplest life cover insurance. You choose the amount and policy term at the start. It pays out a fixed amount, regardless of when a claim is made, as long as it’s within the term of the policy.

Decreasing term life insurance: With this policy, the amount of cover decreases over time. It’s generally the best life insurance to cover debts like mortgages, which reduce over time. For this reason, it’s sometimes called ‘mortgage life insurance’. It’s usually cheaper than level term insurance and a good option if you’re comfortable with the amount of cover decreasing over time, although the premiums stay the same throughout the term.

Critical illness life cover: This insurance can be added to a life insurance policy. It covers you if you’re seriously ill or are diagnosed with a severe medical condition during the policy’s term. In most cases, critical illness cover pays out a fixed lump sum. The payout can be used to pay for private medicine, a holiday, or to help your family financially during your illness, especially if you can’t work.

Over 50s life insurance: This is for people aged 50 to 80 years old. With over 50s life cover, you don’t have to give a medical history. Anyone in the age range is guaranteed to be accepted. You pay for this kind of life insurance through fixed premiums until you’re 85 or 90, depending on the provider. After that, the premiums end, even though you’re covered until you die. Over 50s life insurance usually comes with a qualifying period that ranges from 12 to 24 months. If you pass away during this period, your family won’t get the lump sum payout, but the premiums you paid in will be refunded to them.

Whole of life insurance: As the name suggests, this kind of insurance covers you for your whole life. You pay a premium each month and it pays out a fixed lump sum when you pass away. With whole life insurance, the insurer invests your premiums into a fund. It spreads the investment across stocks, bonds, property and cash, and pays out from the same fund when you claim. But remember, your premiums might increase to cover the payout, if the investment fund performs poorly. But the amount of cover you receive will be the same.

Joint life insurance: This kind of life cover insurance covers two people together, usually a couple. It usually pays out just once, in a lump sum. This tends to be paid to the surviving person. But when that happens, they won’t be covered any more, and they’ll have to find a new life insurance policy if they still want cover.

How to choose the best life insurance for your needs

The cheapest cover is not always the best life insurance. UK's providers offer a variety of policies and the best life insurance is the one that suits your circumstances best.

Start by looking at your debts, your family’s needs and their lifestyle. This will help you work out how much life cover you need and how long you need it for. Once you’ve decided, you can think about doing a life insurance comparison to compare quotes.

Choosing the amount and length of cover

Ideally, the amount of cover – known as the sum insured – should be big enough to cover the remaining balance on your mortgage.

Then, there should be enough left over on top to make it easier for your family to cover some of their other expenses when you’re gone.

Think carefully about how the situation might change if you weren’t around. For example, if you work part-time so you can look after your children, what would your partner do if you weren’t around anymore? They might need to pay for childcare, or they might need to work less. Either way, it would affect their financial situation.

The term of your life insurance policy should also be at least as long as your mortgage. This will make sure the payout covers the remaining balance on your mortgage.

How much does life insurance cost?

The price of your life insurance will depend on factors like:

Your age
Your medical history
Your height and weight
Your smoking habits
Your alcohol consumption
Your salary
The length of the policy you want
How much cover you want

Remember that when you're looking for the best life insurance, UK insurers look at the chance of you unexpectedly passing away and base the price of your quote on this.

For example, a 30-year-old non-smoker with a clean medical history might pay less than a 45-year-old smoker with a medical condition.

Premiums for most life insurance policies are fixed, which means they never increase. It's a good idea to compare life insurance policies and understand the best life insurance companies are offering. You should base your decision on what they include. Find out more about how to make a claim on a life insurance policy.

What do the best life insurance companies cover?

Most of the time, you’ll be covered if you die or are diagnosed with a terminal illness (with a life expectancy of less than 12 months) during the policy’s term.

Even with the best life insurance companies, you usually won’t be covered if you die due to suicide, serious self-injury, a drug overdose or a reckless act. Your cause of death must be covered by the policy if your family is to get a payout. You also won’t be covered if your payments aren’t up to date. You should read your policy booklet carefully so you understand the terms of conditions of your particular policy.

What kind of payout do you need?

Your policy payout will come in one of two types, depending on the policy you choose:

Lump sumThis money might be to help pay off your mortgage, or provide your loved ones with a pot of money
IncomeThis could help your family pay their monthly bills monthly, including mortgage repayments or rent. This income payout usually stops at the end of the policy's term

You will only get a lump sum payment if you take out a whole of life or an over 50s life insurance policy. You could choose from either option when you take out a term life insurance policy.

Which payout is the best?

The best payout for you depends on when you die:

If your death comes a short period before the end of your policy, an income is only paid for the months remaining on the term. If you choose a lump sum payout, your loved ones will get the entire amount in one go.
If you die early on in your policy’s term, an income will pay out for the remaining years. If you choose a lump sum, they get the entire payout as one payment.

Are you eligible for life insurance?

Most people can get life insurance as long as they’re over 18 and live in the UK.

It might be harder to convince life insurance companies to cover you have health issues, or you might have to pay higher premiums. It’s a good idea to get as many quotes as you can from life insurance companies, until you get accepted.

You need to make sure you’re as accurate as possible when you answer the questions during your application, and when you compare life insurance. If you don’t answer truthfully, you might find your policy is invalid when you come to make a claim.

When should you get life cover insurance?

Life cover insurance is a good thing for all adults to think about having, whatever their age.

It can be the best life insurance for people with financial responsibilities like loans or mortgages. And, of course, it’s worth thinking about taking out life assurance cover if you have children or other dependants.

Sometimes people decide to get life insurance when they have a baby or move house. But it’s best to get it at the earliest possible opportunity. The younger you are, the healthier you’re likely to be, and insurers see you as less risky. If you’re healthy, your insurer’s less likely to have to pay out, so they’ll offer you a cheaper premium.

Deadliest fears

How likely are you to die from the world's biggest phobias?

Everyone has that one fear that makes their skin crawl when they think about it or even worse, experience it. Despite most of them being irrational fears, they can still stay creeping at the back of people’s minds.

What is a phobia? 

According to the NHS, a phobia is an overwhelming and debilitating fear of an object, place, situation, feeling or animal.

Here at money.co.uk, we have researched the top phobias of every country around the world, and the likelihood of dying from these fears compared to dying from mundane accidents, to put into perspective how harmful the things we are afraid of really are. 

The most common fears around the world

To discover the world's biggest fears, we analysed search volumes around how to cure different phobias in each country to determine what has each country shaking in their boots!

Here’s what we found:

Flying is the most common fear around the world

A fear of flying is called aviophobia or aerophobia and it is the most common fear worldwide, with an astounding 51 countries searching for how to combat this fear more than any other! France, Germany and Italy, are all searching online for ways to get over this fear, despite it being one of the safest ways to travel. Flying has just a 1 in 11 million chance of ending in a fatal accident, whilst the every-day left ride has a 1 in 10 million chance.

The UK’s worst fear is spiders

Spiders. They may be small but they still manage to strike fear into the hearts of many. Spiders are the most prominent phobia for Brits, despite there being no spiders that can cause death native to the UK - making the UK’s top fear one of the more irrational. In fact, you are 337 times more likely to be struck by lightning than dying from a spider bite.

Next time a tiny, little spider crosses your path, count yourself lucky it wasn't a bolt of lightning instead! 

Oman and Ukraine are terrified of being alone

Is it normal to fear being alone? Well, short answer. Yes. Most people need social interaction to survive. Our study revealed Oman and Ukraine are the only social butterflies that fear being alone more than anything else, with 10 times more searches around this fear than any other.

Public speaking gives Jordan the shivers

Another fear most people have experienced at least once in their lifetime is the fear of public speaking. Getting up in front of a crowd can be a really daunting experience. This seemed to bother one country more than most with Jordan searching for remedies to this fear more than any other.

PositionFear
1Flying
2Heights
3Needles
4Driving
5Death
6Spiders
7Dogs
8Public speaking
9The dark
10Failure

Fear of needles is the third most common fear in the world

Flying is the most common fear in the world, despite dying from using your lawnmower being 2.5 times more likely than death from taking a flight. Twice as many people looked online for ways to get over this fear this year, than the fear of driving.

The third most common fear worldwide is needles. Nobody is particularly a fan of getting something sharp into their arm or sometimes, in other places. But, countries like Australia, the United States and Canada were all dying to know how to get over that fear. 

Fear of dying made it into the top 10 most common fears in the world with people searching how to get over the fear more than the fear of dogs. ‘Where do we go after we die?’ is a question on everyone's minds.  

A fear most people grow up with is a fear of the dark with people searching how to get over the fear of darkness more than the fear of sharks. 

What could be lurking in the shadows? 

How likely are you to die from the world's biggest fears vs common accidents?

To see just how deadly these fears really are, we looked into how likely you are to die from the world’s biggest fears compared with some of the most common and mundane accidents.

So which is worse?

You are 1,212 times more like to die from sunstroke than flying

You are more likely to die from sunstroke than from any of the common phobias. With 1, 212 people per 10 million dying from heat exhaustion.

Spiders might look terrifying with their 8 legs and freaky pincers, but they are just as deadly as a fun party balloon, causing the same amount of deaths in recent years! In fact, everyday accidents like falling out of bed are more likely to kill you than spiders. 70 times more likely in fact.

Yes, looking down into the ocean and seeing a shark swimming by your feet is definitely up there with the shock factor. But, they only kill 0.01 people per 10 million people. In fact, you're 100 times more likely to die from a TV randomly falling on your head than you are from a shark attack. They don’t seem so scary now, huh?

To show just how deadly your fears are vs how likely you are to die from some of the most common accidents, we visualised the likelihood of dying from them in two infographics that will keep you scrolling.

Life insurance FAQs

Only if your cause of death is covered in your policy, and you die during the term of the policy. Here is more on how life insurance works.

Yes, but you may find it cheaper to have one policy that gives you the exact cover you need.

Yes, but you both have to qualify for the policy and get accepted by the insurer when you apply. Compare joint life insurance quotes here.

You may find it harder to get cover if you have any health issues. Get as many quotes as you can until you get accepted for the cover you want.

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