Life insurance is designed to ensure that those you leave behind when you die do not face financial hardship in your absence.
There are many different types of life insurance, designed to suit different circumstances. This page covers all types, and features our top-rated providers based on price, customer service and reliability when it comes to paying out.
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What is life insurance?
A life insurance policy pays out a sum of money to your loved ones if you die while the policy is active. It is intended to ensure that those you leave behind don’t suffer financial hardship as a result of your death.
You’ll need to pay monthly contributions (‘premiums’) to keep your plan active.
What is term life insurance?
Term life insurance provides cover for a specific period of time. It’s often purchased to accompany the term of a mortgage, or to cover the years when policyholders have children depending on their income.
There are different types of term life insurance policies, including:
What is whole of life insurance?
Whole of life insurance has no end date and guarantees a payout as long as premiums are paid.
What is terminal illness cover?
Terminal illness cover is a type of life insurance that pays out a lump sum if you are diagnosed with a terminal illness and have less than 12 months to live. It’s different from standard life insurance, which only pays out if you pass away during the policy term.
Can I cash in my life insurance?
It depends what kind of policy you have and the terms of that policy. With a term life insurance policy, there is no option to cash-in the policy at any point. It only pays out if you die within the duration of the policy. Some whole of life policies have a cash element, however, which means that some of your premiums are invested, and returns on this investment can be withdrawn or used to borrow money.
How much will I pay for life insurance?
Your premiums (the ongoing payments for your cover) will vary depending on a number of different factors. They include:
Remember: Insurance policies will only provide cover as long as you continue to pay your premiums.
Want to understand more about life insurance? Read our full guide here.
Yes, you can have more than one life insurance policy with different providers.
Not all providers require medicals to issue life insurance policies. You will be required to be completely honest about any medical conditions you currently suffer from, or have previously suffered from. Some medical conditions will require a medical examination.
If you and your partner share a joint life insurance plan, and you separate, most providers will allow you to separate the plan into two individual policies.
Insurance policies are only valid as long as you continue to pay your premiums. If you stop, the policy will be terminated. If you are in financial difficulties, however, and struggling to afford your premiums, speak to your insurance provider as there may be alternatives to cancelling the policy. Some providers allow payment breaks, and there may be a possibility of transferring to a cheaper plan that means you don’t lose your cover altogether.
