In life, unexpected events can and do happen. It is always better to be prepared and protect those that are dearest to us financially.

From premiums as low as £5 per month, there are life insurance policies to fit all budgets. The premiums won’t be the same for everyone, so getting the most competitive price for you is essential.

How much life insurance do I need?

When it comes to calculating how much life insurance you need, here are 5 points to consider: 

  1. Mortgage – How much is outstanding? Should you die unexpectedly, do you have loved ones that will need a roof over their heads? Paying off the mortgage will provide the peace of mind that they can remain in their own home, even without your income. 
  2. Rent – How much rent do you pay per month? Also, consider how much your rent may increase in the future. Again, if you have loved ones that depend on your income to keep a roof over their heads, this is an important consideration.
  3. Debts – What is the total amount owed and over what term?

4. Outgoings – regular monthly bills such as travel costs, utility bills, council tax, school fees, and maintenance payments perhaps? These all add up over time for those who are left behind.

5. Family – If you have children or dependents, how long do you feel they will be dependent upon your income/care?

Your Future Proof adviser can help you calculate how much life insurance you need. It is an important factor to get right. You don’t want to be over-insured, where you are paying out too much in premiums. Or, under-insured, leaving your dependants still needing financial support.

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How much does life insurance cost per month?

Our simple 4 step online quote system will give you an idea of how much life insurance could cost you per month. 

However, if you have a pre-existing medical condition, high risk job or hobby, you should expect to pay more than the figure quoted. 

To get a more precise figure taking any of the above factors into consideration, please request a call back or dial 0800 644 4468 to speak to one of our friendly advisers. 

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How much should I expect to pay for good life insurance?

The amount you should expect to pay for ‘good life insurance’ varies due to many factors. 

Life insurance is the most basic of all protection insurance products. In the simplest of terms, its purpose is, that you die and the policy pays out a lump sum to your loved ones. 

The term ‘good life insurance’ can be best described as what additional benefits are included in the basic policy premium? More about additional benefits. Find out which insurers pay out the highest percentage of claims?

In terms of how much you should expect to pay for life insurance, there are many factors that contribute to an insurer’s decision on your premium. 

  • Age
  • Weight
  • Lifestyle
  • Occupation
  • Policy length
  • Medical history
  • Amount of cover
  • Family medical history

Whilst our online system will give you a basic idea of cost in 60 seconds. It is better that you obtain a more precise quote from one of our Advisers. This will take all factors into consideration and avoid any unnecessary shocks later in the application process.

How long does a life insurance policy last?

How long a life insurance policy should last depends on what the policy is for:

  • For a mortgage, the policy should last until you have paid the mortgage off in full
  • For family cover the policy should last until your dependents are no longer dependent on you
  • For family income benefit, the policy should last until your children are grown up and out of private education or university.
  • For funeral cover, the policy if it is a whole of life one will last until you die.

What is a life insurance beneficiary?

A life insurance beneficiary is a person who will receive the insurance payout.

The type and severity of a pre-existing medical condition will determine if you are able to obtain life insurance. 

An insurer may offer life cover with a higher premium which is called a rating or loading. The higher premiums cover the additional risk that your medical condition poses to your life. This may mean that they will have to pay out an early claim.

With a pre-existing condition, part of our process is to pick up the phone and call insurers to ask for their opinion before you apply. 

We work with a range of well-known protection insurers, as well as specialist insurers that do not deal directly with the general public. Based on this outcome, we then help you apply to the most sympathetic and get you cover at an affordable price.

Insurers may request a medical report from your doctor or a private medical examination (which they will pay for). This will help them evaluate your health and pre-existing conditions. 

Smoking does impact the price of life insurance. Smokers statistically die younger*.  Insurers charge them more to reflect the greater risk of an early claim being made on their policy. 

Non-smokers, or people who have given up smoking, have a reduced risk of claiming. This is therefore reflected by lower premiums being charged by insurers when compared to a smoker’s premium. e

The rules are different for different insurers. If you have either

  •  Stopped smoking for longer than 12 months
  • Do not use any tobacco products such as e-cigarettes or nicotine replacement substitutes

We can help you to reduce your premium by switching you to non-smoking rates.

The rules are constantly changing however. Some Insurance Providers could still charge more if an applicant has smoked within the last 5 years.  We are happy to investigate which provider will offer you the most competitive premium.

*NHS.co.uk Oct 2021

The following frequently asked questions relate to medicals and health

  • If you have life insurance in place and are diagnosed with cancer, your premiums will remain unaffected. You might want to check that you have the Waiver of premium option included in your policy. If you have then this means that the insurer will pay for your premiums on your behalf and keep your cover running, if you are too ill to work.

    If you are applying for life insurance and have cancer it is unlikely that you will be offered cover at this point. There is a possibility that you may be offered cover in the future. There are many details an insurer will want to know to help them in their decision. 

     

    1. What type of cancer and where? It’s stage and grade?
    2.  How long ago were you diagnosed?
    3.  When did you last have treatment?
    4. What treatment did you have?
    5. Has the cancer spread?

     

     These will influence the premium and ultimately whether or not you will be offered cover. Every insurer has their own guidelines on cancer. We can guide you through the questions and search for the most sympathetic insurers on your behalf.

  • If your policy is up and running and you develop a long-term illness, your premium will not change. It will have been guaranteed at the time you applied for cover. It is important to check and see if you have opted into the Waiver of premium additional benefit. This will ensure that if you are too ill to work for a certain period and therefore pay for your premium, the insurer will continue your cover. Terms and conditions apply such as waiver of premium is only available if you are employed, and usually only until you reach 65. 

     

    If you already have a long-term illness and are applying for life cover. The insurer will want to know about your condition before they accept you. They may raise your premium to cover a higher than usual risk. Or, they could exclude your illness from the policy. At worse they could decline to cover you altogether.

  • If you become disabled whilst you have a policy already in place, your premiums won’t change, as they were guaranteed at the start of the policy. If you are applying for life insurance and you are disabled, your disability may be taken into consideration if it affects your life span. 

     

    The insurer may request a report from your GP, or request that you take a private medical examination ( which they will pay for). This will help them to assess their risk based on your individual condition.

  • The vast majority of life insurance policies are taken out without the need for a medical exam, or a report from a GP. 

    The most important factor is that you have clean bill of health with no pre-existing medical conditions. Combined with: 

     

    1. You don’t have a high risk job
    2. You don’t have a dangerous hobby
    3. You are of working age and looking for a small amount of cover

Do different types of life insurance cost different amounts?

Different types of life insurance do cost different amounts.

If you have a capital repayment mortgage,  it is likely that you will have been advised to consider a decreasing term insurance policy. 

This is a life insurance policy where the the amount insured reduces throughout the policy length in line with the total mortgage owed.

As the insurers risk reduces over time, this type of policy will be cheaper than a level term policy. Where the amount insured remains the same for the length of the policy and does not reduce.

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What is the breakdown of average cost by age group?

Age of client in yearsSum assured in £sTermType of coverPremium in £s
30£100k20Level term life only£4.83
30£250k20Level term life only£7.93
40£100k20Level term life only£7.83
40£250k20Level term life only£15.25
50£100k20Level term life only£16.53
50£250k20Level term life only£36.62
60£100k20Level term life only£44.58
60£250k20Level term life only£105.02

Please note that any premiums mentioned are indicative only and based on this specific case study/ example, which is shown for information purposes only. Your own circumstances will determine whether the amount payable is more or less than the figure quoted.

What is the cost of life insurance with critical illness cover?

The cost of life insurance with critical illness cover will be higher than the cost of a life insurance policy. This is because statistically, it is more likely that we will become seriously ill than die.*

*These probabilities are based on the rates of a critical illness occurring, published by the Institute and Faculty of Actuaries’ Continuous Mortality Investigation (’08’ series accelerated critical illness morbidity tables).

These factors will all affect the cost of life insurance with critical illness cover:

  • Age
  • Weight
  • Lifestyle
  • Occupation
  • Policy length
  • Medical history
  • Amount of cover
  • Family medical history

Our Advisers are on hand to give you a callback and provide you with a tailored quote if you have a pre-existing medical condition or a high-risk occupation/ hobby.

The table shows a comparison of life insurance premiums with and without critical illness cover included.

Age of client in yearsSum assured in £sTermType of coverMonthly premium in £s
40£100kTo age 65Level term Life only £8.71
40£100kTo age 65Level term life or critical illness£47.36
50£100kTo age 65Level term Life only £13.99
50£100kTo age 65Level term life or critical illness£79.81

The following frequently asked questions relate to the varying costs of life insurance depending on your circumstances

  • The cost of including your mortgage in your life insurance policy, will partly depend on the amount outstanding on your mortgage. The more important question is, whether your current life insurance policy is the best fit for your mortgage?

     

    There are many factors to consider:

     

    • Is your mortgage a repayment mortgage or interest only?
    • What kind of life insurance policy do you currently hold? Is it a level term policy?
    • Does your current life insurance policy have the added option of indexation?

     

    Depending on the above factors, simply adding your mortgage to your current life insurance policy may not be the best option for you. It might be more beneficial to apply for a separate life insurance policy for your mortgage. We can help you decide the best option in terms of suitability and premium.

  • To give you an idea of how much joint life insurance costs, our 60 second quote engine will give you a ball park figure. . It is important to remember that a ‘joint’ life insurance policy is one plan that covers two lives. The insurance will only be paid out on the ‘first death’. After the claim is paid the policy would end leaving the person left without life cover. If there is still a need for the person left to leave a payout to a dependant, this could prove tricky later in life. 

     

     

  • It is not cheaper to take out two individual life insurance policies instead of a joint life one. The main reason being that two individual life policies would require an insurer to pay out twice. ie upon the death of both individuals. A joint life policy only pays out once, so the premium would be cheaper.

     

  • If you are single, this will not affect the cost of life insurance. We can help you decide what type of life insurance is suitable for you, even if it is just how much you need and for how long. Our online quote service takes 60 seconds and will give you an idea of the premiums payable.

  • Yes, life insurance is more expensive if you are retired. However, the reason has less to do with your retirement from work and more to do with your age. The cost of life insurance increases the older you get. So, it is advisable to apply for life insurance as soon as possible to lock in lower premiums for the duration of your policy. 

  • How long you have to pay for life insurance depends on:

    • How long will loved ones be dependant on your income?
    • How long will it take you to pay off your mortgage?
    • How long do you have left to settle any loans?
    • Do you have enough in savings to pay for your funeral? 

     

    As long as you have what is called an insurable interest ie a reason for  life insurance. Then it is important to pay for it until it is no longer needed. 

  • There are two answers to ‘does the cost of life insurance change over time?’

    If you have a policy in place, then you will have locked in your premiums and they will not change over time.

    However, if you are thinking of applying for life insurance, premiums do increase with age. The older you are when you apply for life insurance, the higher the premiums. This is because the risk of you becoming ill and dying increases. It is beneficial to apply for life insurance as soon as you are over 18 and have a reason to.

     Some policies are age related and the premiums will increase each year the older you get. The upside – they are cheaper when you take them out, when compared to a level term guaranteed premium. The downside – there will become a point where they are more expensive than a level term guaranteed premium as you get older. Potentially they will become unaffordable in the long term.

What if I can’t afford to keep up the payments on my policy?

If you can’t afford to keep up the payments on your policy there are various things we can do to help you. It is important to remember that some cover is ALWAYS better than no cover though.

Many households are having to re-jig their monthly commitments in the current economic climate. Help is at hand though and there are many things we can do to help ease your financial worries without shifting the focus of your needs for the future.

1) We can look into removing any paid-for benefits which are an additional charge on top of your standard cover to reduce your monthly premium. E.g Global Treatment

2) Reducing the sum assured

3) Switch your policy from an increasing sum insured (index-linked) to level so that your payments are fixed

4) Recommend a Decreasing Term policy instead of Level Term for your mortgage (applicable for repayment mortgages only)

5) Reduce the term of your policy

6) Look into the possibility of a Level Term policy to replace a Whole of Life policy

7) Did your original policy have increased premiums due to your medical disclosures at the time? Have you given up smoking? We can review the market to ensure that you are receiving the best underwriting terms and the cheapest premium available

8) Are you a Company Director? We can look into arranging life insurance which is paid through your company, making your income more tax-efficient and saving you money?

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How much does life insurance cost if it’s through a business or employer?

Life insurance through a business or an employer will cost the same as if you were paying yourself. The risk of a person dying and the policy paying out the claim will be the same to the insurer. 

However, if you own your own business it is possible to pay for your life insurance premium through your business. Known as  ‘Relevant life cover’. It can be a tax-efficient way to offset corporation tax. It could result in savings of an equivalent of up to 50% on the premiums, depending on your tax band. It is also a good way of providing Death in service for a small company.

*The levels and bases of taxation, and reliefs from taxation, can change at any time. The value of any tax relief depends on individual circumstances.

 

The following frequently asked questions relate to claims and payouts

  • Life cover pays out to your beneficiaries as much as you have chosen to insure but it is vitally important to complete a Trust form. This form will ensure that the insurance pay out stays out of your estate when you die. This means that it will not be subject to Inheritance tax. 

    In your Trust form you can divide the share of the insurance payout between your loved ones. It will aslo allow you to name specifically who you would like to benefit from the policy proceeds. 

    Full information here: Life Insurance Trust

    The levels and bases of taxation, and reliefs from taxation, can change at any time. The value of any tax relief depends on individual circumstances.

    Trusts are not regulated by the Financial Conduct Authority.

  • How much your loved ones will be taxed will depend on whether you have completed and registered a Trust form. If you have, the proceeds from your life policy will not form part of your estate and will be excluded from any inheritance tax calculation. 

     

    This means that the overall value of the estate for the calculation of inheritance tax is reduced. This lowers the potential tax liability and in some cases may result in no tax having to be paid on the estate. Full information here: Life Insurance Trust

    Future Proof provide a Trust service with advice at no additional cost.

    The levels and bases of taxation, and reliefs from taxation, can change at any time. The value of any tax relief depends on individual circumstances.

    Trusts are not regulated by the Financial Conduct Authority.

     

Can I have a quote for life insurance?

For an exact quote for life insurance and no obligation advice, even if it is just to confirm how much should I insure and for how long? Our friendly advisers are happy to help you today:

0800 644 4468

If you would like a ball park figure our 60 second online quote tool will provide you with an average monthly premium for life insurance.

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