Life Insurance is there to provide some financial support for your loved ones after you’re gone, whether that means helping to pay off the mortgage or maintaining their standard of living. It could even pay for your funeral if you haven’t set anything aside for that. You pay a monthly premium for life insurance. Your age, health, lifestyle and how much cover you need, as well as the type of policy you have, will usually determine how much you pay.
Please note companies are ranked in no particular order and data comes from each company’s website and was last updated in March 2023.
Topics
1. Aegon
- Originally known as Scottish Equitable
- Now one of the world’s largest providers of life insurance
- Also specialises in pensions and asset management services
- Multiple award winner including 2019 Best Claims Management / Claims Team award, Cover Protection award, Moneyfacts award, HR Specialist of the Year
- Moneyfacts 5 Star Rating
- Defaqto 5 Star Rating
- Useful online resources such as a Retirement Advisory Library, Pensions Technical Zone and Retiready
- Free Health and Wellbeing service and counselling support available 365 days a year
- £128 million paid in claims last year
- Also offers critical illness, income protection and whole life insurance
Website: Aegon
Read the full Aegon life insurance review.
2. AIG
- AIG Life Limited is the UK life insurance arm of the American International Group
- Customers in more than 80 countries
- Large range of insurance products and protection cover
- Products divided into four areas: Term Insurance, Family income Benefit, Life Start and Instant Life Insurance
- Generally favourable reviews and customer experiences
- Free Smart Health consultations and Best Doctors service
- Unbiased financial advisers available
- Useful supporting literature and online help
- Also offers over 50s, critical illness, income protection and whole life insurance
Website: AIG
Read the full AIG life insurance review.
3. Aviva
- Established in 1696
- The largest insurance company in the UK
- Over 15 million customers
- A large range of life and health insurance plans and related products
- 98.9% of claims paid
- Medical exams not needed
- Currently offer a free £50 M&S voucher for new customers
- An informative website with plain English explanations
- Useful ‘cover calculator’ resource online
- Flexible length of cover offered
- Free Parent Life cover
- 5 Star rated by Defaqto
- Generally mixed online reviews
- Also offers over 50s and critical illness life insurance
Website: Aviva
Read the full Aviva life insurance review.
4. Barclays
- One of the largest, most reputable banks in the UK
- Simple Life Insurance starts from just £6 per month
- Flexible payment terms offered
- 20 minute promise from getting a quote to getting your policy
- Useful online resources available such as the cover calculator tool
- Handy online jargon buster guide
- A large range of related service offerings including Banking, Borrowing and Investment Services, Mortgage Policies and Home and Travel Services
- Also offers mortgage and critical illness life insurance
Website: Barclays
Read the full Barclays life insurance review.
5. BHSF
- A credible not-for-profit health and wellbeing provider
- Origins date back to 1873
- Customer service feedback is very good
- Live insurance cover from only £2 per month, much cheaper than most other providers
- Medical exams not needed to qualify
- Other services include Health Cash Plans, Travel Insurance, Personal Accident Insurance and Will Writing
- Also offers critical illness life insurance
- Family history not factored in for critical illness cover – even if you’ve got a history of cancer
Website: BHSF
Read the full BHSF life insurance review.
6. Canada Life
- A long established, global company dating back to 1847
- Award-winning products and services
- 5 Star financial rating
- Includes automatic cover for children
- ‘Canada Life App’ included with cover
- 1000s of extra rewards and discounts offered to customers
- Useful online support tools available such as budget planners and loan calculators
- Policies include free access to counselling and wellbeing services
- An easy to navigate website with useful FAQs and a glossary of terms
- Comprehensive whole of life insurance plans for ultra-high-net-worth individuals
- Critical illness covers 52 critical conditions, including 44 additional illnesses for a lower amount of cover
Website: Canada Life
Read the full Canada Life life insurance review.
7. Churchill
- A large, respected UK brand
- Now acquired by the Royal Bank of Scotland Group
- The second largest general insurer in the UK
- 2019 Organisation of the Year award winner
- Many positive reviews and happy customers
- Specialist in life cover for over 50s
- Competitive cover from £4 per month
- Smart Health services offered at no extra cost
- Online virtual assistant can make changes to your policy and offer additional resources
- Useful online life insurance calculator available
- Tesco gift card offered to new customers
- Also offer over 50s and critical illness life insurance
Website: Churchill
Read the full Churchill life insurance review.
8. Coop
- A long established, trusted brand since 1844
- One of the world’s largest consumer co-operatives
- Competitive monthly payments from £3.95
- 5% off life cover for members for the term of the policy
- £50 Co-op Food vouchers when you buy a new life cover policy
- Payment holidays offered
- Terminal illness cover included at no extra cost
- A large range of insurance offerings including car, home, life, travel, buildings, pet, breakdown and young driver insurance
- Also offers over 50s and critical illness life insurance
Website: Coop
Read the full Coop life insurance review.
9. Covea
- A global commercial insurer
- Over 5 years heritage in the market
- Specialist insurance products for members of HM Armed Forces
- Award winning claims service
- Some positive reviews and feedback from happy customers
- UK customer support team available 24/7
- Other products include car and home insurance and accident protection
- Also offers over 50s and critical illness life insurance
Website: Covea
Read the full Covea life insurance review.
10. Countrywide
- The UK’s largest property services group
- A large network of consultants
- 850 branches across the UK
- A large range of related protection products across other sectors
- Products provided by Aviva and AXA
- Also offers mortgage, critical illness and income protection life insurance
Website: Countrywide
Read the full Countrywide life insurance review.
11. Direct Line
- A well-known brand offering a large portfolio of insurance products
- Defaqto 5 Star rating
- An informative website with decent supporting documentation
- Existing customers receive a 7% discount
- Competitive cover from £5 per month
- Policy provided by AIG
- 99% of claims paid out
- Guaranteed acceptance for over 50s cover
- Medical or health assessments not required
- Gift card worth up to £180 for new customers
- Other products include car, home, business, travel, pet and landlord insurance
- Also offers over 50s and critical illness life insurance
Website: Direct Line
Read the full Direct Line life insurance review.
12. HSBC
- A trusted brand name
- One of the world’s largest banking and financial services organisations
- Life cover pays up to £2 million upon death or terminal illness diagnosis
- Accidental death cover included for free
- Income protection cover includes additional services such as specialist rehabilitation support
- A large range of related financial products available
- Online planning tools available to facilitate decision making
- Telephone Protection Advice service offered
- Also offers critical illness and income protection life insurance
Website: HSBC
Read the full HSBC life insurance review.
13. Legal & General
- A popular, trusted brand, founded in 1836
- One of the UK’s largest providers of life insurance
- 5 Star Defaqto rated
- 2020 Moneyfacts award winner
- A large range of individual life assurance products to choose from
- Competitive premiums from £5 per month
- Acceptance is guaranteed with no medicals required
- Helpful online life insurance calculator
- A well informed website with decent FAQs and supporting information
- Free £100 M&S or Amazon gift card for new customers
- Also offers over 50s, mortgage, critical illness and income protection life insurance
Website: Legal & General
Read the full Legal & General life insurance review.
14. LV
- A long established, trusted brand since 1843
- Excellent customer feedback
- Winner of the Moneywise Most Trusted Life Insurance provider seven years running
- Competitive cover from £5 per month
- Terminal illness cover included at no extra cost
- Children’s critical illness cover automatically included as part of main critical illness cover
- Single life or joint life cover available
- Free access to LV Doctor Services
- A helpful, informative website
- Also offers mortgage, critical illness and income protection life insurance
Website: LV
Read the full LV life insurance review.
15. M&S Bank
- A long established trusted UK brand
- Excellent customer feedback
- Single or joint life cover is available
- Level and decreasing cover options available
- No medical examinations needed to apply
- A large range of financial services offered
- An informative website with easy to understand information
- Free £100 gift voucher offered to new customers
Website: M&S Bank
Read the full M&S Bank life insurance review.
16. Nationwide Building Society
- A trusted popular brand
- The largest building society in the world
- 15% discount on life insurance for members
- A wide range of critical illnesses are covered including additional benefits for children
- A large range of related financial services offered
- Well informed website
- Decent online FAQs and supporting information
- 30 day cool down period
- Also offers critical illness, mortgage and income protection life insurance
Website: Nationwide
Read the full Nationwide life insurance review.
17. NFU Mutual
- A trusted brand name within rural communities and businesses
- Owned and run by its 900,000 members
- Partnered with AIG to provide cover
- Comprehensive levels of life cover offered
- Single and Joint Life policies available
- Also offers critical illness, income protection and whole life insurance
Website: NFU Mutual
Read the full NFU Mutual life insurance review.
18. NPA
- A long established business since 1921
- A representative voice of the pharmacy sector to government and regulatory bodies
- Products are specialist for the pharmacy sector
- Terms and decreasing cover options available
- Also offers mortgage, critical illness and income protection life insurance
Website: NPA
Read the full NPA life insurance review.
19. Post Office
- A trusted and well-respected brand, owned by UK Government Investments
- Voted Best Online Life Insurance Provider 2019 by YourMoney.com
- Life insurance policy is provided by The Royal London Mutual Insurance Society Limited
- Policy includes Terminal Illness Cover at no additional cost
- No need of a medical examination
- A large range of financial and related services offered
- An informative website with useful links, FAQs and an online Life Insurance Calculator
- Free £50 Argos, M&S or Amazon Gift Card for new customers
- Also offers over 50s, mortgage and critical illness life insurance
Website: Post Office
Read the full Post Office life insurance review.
20. Royal London
- A popular, well established and respected brand
- The UK’s largest mutual life and pensions company
- 2020 Platinum Trusted Service award winner
- Some excellent online reviews from happy customers
- A large range of insurance, pension, investment, retirement and funeral products offered
- Acceptance is guaranteed with no medical required
- Terminal Illness Cover included at no additional cost
- A helpful website with decent access to FAQs and online resources
- Also offers over 50s, critical illness, mortgage, income protection and whole life insurance
Website: Royal London
Read the full Royal London life insurance review.
21. Sainsbury’s Bank
- A trusted British brand
- Britain’s longest standing Supermarket Bank
- Good customer feedback and reviews
- A quick, simple online process
- Most life insurance products offered
- Related services include loans, savings, insurance, travel money and credit cards
- Also offers over 50s, mortgage, critical illness and whole life insurance
Website: Sainsbury’s Bank
Read the full Sainsbury’s Bank life insurance review.
22. Sanlam Wealthsmiths
- A well-established life insurance company over 100 years old
- Strong range of related financial services offered
- Personalised policies available for tailored needs
- Defaqto 5 Star Rating
- Multiple award winner including Private Asset Manager Awards 2019, Wealthnet and Investors Choice
- Also offers critical illness and income protection life insurance
Website: Sanlam
Read the full Sanlam life insurance review.
23. TSB
- A large, well-known brand
- Partnered with Legal & General to provide protection products
- Competitive premiums from £6 per month
- Terminal Illness Cover and Accidental Death Benefit included for free
- A large range of related financial services including various bank accounts, savings, loans, mortgages and insurance products
- Also offers mortgage and critical illness life insurance
Website: TSB
Read the full TSB life insurance review.
24. UNISONProtect
- More than 1.5 million trade union members worldwide
- Policies underwritten by Scottish Friendly Assurance Society Limited
- Acceptance guaranteed with no health questions or blood tests required
- Related Accident Protection Plans offered in support
- Over 50s Accident Plan also available
- Members receive £5,000 of free Accidental Death Cover
- A simple but well informed website
Website: UNISONProtect
Read the full UNISONProtect life insurance review.
25. Vitality
- A popular, family brand
- Excellent reviews and great customer feedback
- A large range of cover options to choose from
- Competitive cover from £9.75 per month
- Up to 40% off life insurance premiums for the first year
- Critical illness plan covers 182 conditions, more than any other cover on the market
- A helpful, informative website
- Useful online resources and supporting documents
- 5 Star Defaqto Rating
- Also offers mortgage, critical illness, income protection and whole life insurance
Website: Vitality
Read the full Vitality life insurance review.
26. Zurich
- A global insurance company covering 170 countries worldwide
- Competitive monthly premiums from £5 per month
- 5 Star Defaqto Rating
- Good online customer reviews
- Decent online resources and supporting information available
- A large range of related insurance products available including car, home, boat and travel insurance
- Also savings, investments, ISAs and pensions
- Free £100 gift voucher for new customers
- Also offers mortgage and critical illness life insurance
Website: Zurich
Read the full Zurich life insurance review.
What is life insurance?
Life insurance is a contract between you and a life insurance company. You agree to pay for the policy on a regular basis, and the insurer agrees to pay a sum of money to your beneficiaries if you die. It’s there to provide some financial support for your loved ones after you’re gone, whether that means helping to pay off the mortgage or maintaining their standard of living.
It could even pay for your funeral if you haven’t set anything aside for that. You pay a monthly premium for life insurance. Your age, health, lifestyle and how much cover you need, as well as the type of policy you have, will usually determine how much you pay.
How much does life insurance cost?
The average monthly cost of life insurance is £15.85, according to MoneySuperMarket data from July 2019 to June 2020. Since it’s difficult to determine an average life insurance cost for everyone, you will need to assess what your personal needs and circumstances are to get an accurate life insurance estimate.
Considerations may be your mortgage, your cost of living, how much your life insurance costs will be dictated by the type of insurance you need, the size of the payout you want and your existing savings or saleable assets. Online broker Reassured have developed a life insurance calculator which can help you establish the size of the payout you require.
As a rule of thumb, the lower the payout, the lower the monthly premiums. Life insurance premiums are also based on the risk the policy holder poses to the insurer. Therefore, the higher the risk, the higher the premiums. The cost of life insurance can depend on the type of cover you choose (single or joint life insurance) and the term of the policy (level or decreasing term).
How much life insurance do I need?
How much life insurance cover you need really depends on your circumstances and the type of protection you’re looking for. For example you may be looking to protect your mortgage, cover additional debts, or provide a lump sum for your loved ones to maintain their standard of living.
A rule of thumb is to arrange cover 10 times the main breadwinner’s income. But you might want cover nearer 15 or even 20 times your annual income if you have major outgoings and a large family to support. Dependency doesn’t always only need to be financial; for instance, you may be responsible the physical care of a relative.
The aim is to have enough cash to cover the lack of income if you’re gone. So if you have no partner or children who need the money don’t bother. If you do need cover, it’s important to consider the financial impact if you died. When working out how much cover you need, check that you have sufficient cover against both capital and interest repayments.
How long does life insurance take to pay out?
Life insurance will not pay out automatically, and a claim must be made directly to the insurer. Anyone can start a claim, but the recipient of the money will be determined by the policy or the will of the deceased.
Life insurance benefits are typically paid within 30 to 60 days of the filing of a claim, after the company receives the required documents, such as a copy of the death certificate, the beneficiary’s current address, etc. Delays can sometimes arise, if the insured dies within the first two years of the issuance of a policy, or if there are documentation issues, for example.
Payout options include lump sums, instalments and annuities, and retained asset accounts.
What does life insurance cover?
Life insurance is a way of helping your family cope financially when you die. It is intended to provide help to your loved ones when they can’t rely on your salary or income any longer. The pay-out can be used to clear debts, pay off the mortgage or just cover everyday expenses.
The type of death usually covered include natural death or death caused by health-related issues. Death caused by self-inflicted injuries or hazardous activities, sexually transmitted diseases like HIV or AIDs, suicide, death due to natural disaster, death caused by child birth, drug overdose, or death due to pre-existing health conditions are not usually covered by the insurer.
How long should I get life insurance for?
Usually, the duration of your life insurance will be dictated by what you want it to cover. The two main reasons you might want to take out a life insurance policy are usually to help protect a mortgage or to provide financial protection for those closest to you in the event of your death. Most policies run for between 10 or 25 years, but you specify how long you want the term to be.
If you die during the term, the policy will pay out the amount agreed at the start, which is known as the ‘sum assured’. Some policies will have you eligible for a death benefit immediately, while others will make you wait four or five years before it takes effect. However, the average amount of time before your life insurance takes effect is one to two years.
What is decreasing life insurance?
Decreasing term life insurance, sometimes known as mortgage life insurance, is a type of life insurance policy that is paid over a fixed period of time. The level of pay-out decreases over the length of the policy and it is often used to cover the balance of a repayment mortgage.
Decreasing-term life insurance is a cheaper form of policy that pays out less as time goes on. If you pass away near the beginning of the insurance term, your loved ones will receive more money than if you pass away near the end. Because the sum insured decreases over time, monthly premiums tend to be much lower for decreasing-term life insurance policies.
Decreasing-term life insurance ensures that if you die, your loved ones won’t have to face the stress of paying off your outstanding debts – or even having to move home – at an already difficult time. Many mortgage lenders actually insist that you have a life insurance policy in place before they’ll agree to lend you money for this very reason.
Decreasing-term life insurance is no use if you have an interest-only mortgage – for instance, on a buy-to-let property.
What is level term life insurance?
Level term insurance is one of the most popular life insurance policy types. These policies will offer you protection in the event that you die within a certain set period. The amount paid out will not change over the course of the policy term, unlike with decreasing term insurance.
When you take out a level term life insurance policy, you will set a term at the beginning, usually around 25 years, as well as a pay-out size. This pay-out will be the same whether you die at the beginning or end of the policy term. One of the main reasons people take out life insurance policies is to make sure that their remaining family can keep up with mortgage repayments in the unfortunate event of their death.
Level term life insurance is not just for debts though, you may simply want to leave a certain amount of money for your family to help them cope financially during the most difficult of times.
What is whole life insurance?
Whole life insurance, or whole of life assurance, is sometimes also referred to as “straight life” or “ordinary life,” and is a life insurance policy which is guaranteed to remain in place for the insured’s entire lifetime, provided the required premiums are paid, or to its maturity date.
Hence, premiums are level as long as you live. Since whole life insurance offers protection for life it doesn’t expire or go down in value, in fact the policy builds cash value, which makes it an attractive option for many. However, whole life insurance is not as flexible as other permanent policies, it can take a long time to build cash value, and it can be expensive – comparatively – with a significantly higher price tag.
The initial annual cost will be much higher than the same amount of term life insurance. Whole life insurance policy lets you pay premiums for only a specific period, such as 20 years or until age 65, but insures you for your whole life.
Which life insurance is best?
Getting the right life insurance policy means working out how much money you need to protect your dependants. This sum must take into account their living costs, as well as any outstanding debts, such as a mortgage. Level term insurance lasts for a pre-agreed number of years and pays out a set amount if you die during that term.
It is usually simple and affordable for most, and is best for people with dependants and those with an interest only mortgage. Decreasing term insurance lasts for a pre-agreed number of years, which usually matches the length of your mortgage, and pays out if you die during that time.
Each year the potential pay-out decreases as it is designed to be used with a repayment mortgage where the outstanding loan decreases over time. As such, it is cheaper than a level term insurance and affordable for most; ideally for those with a repayment mortgage whose dependants can cover other expenses.
Whole-of-life insurance covers you for the rest of your life so your dependants get a pay-out no matter when you die. This type of policy is typically more expensive than those that cover a set period of time. It is generally used to provide money to cover a funeral or for inheritance tax planning.
When choosing a life insurance company, always pick one with financial solidity as you will want a company that is financially secure enough to pay your claim when the time comes. Also consider which company has the best product range to suit your needs, offers good advice and customer service, has strong market ethics and ideally has a rich company history.
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