The Best Life Insurance Policies for 2022
We’ve ranked and reviewed the best life insurance policies in the UK for 2022 to find you the best deal.
The 10 best life insurers
How we created our list of the best life insurance policies
When it comes to finding the right life insurance for you, it can sometimes be a hard task. Luckily, there are a few signs you can look out for when it comes to finding a good policy.
We outlined a set of requirements that we felt all our insurers had to hit for their policies. We’ve only included insurers that:
Cover for any pre-existing medical conditions or no medical needed upon applying for the policy.
Optional mortgage cover or included as standard.
Funeral plans to be included as an optional extra.
What is life insurance?
Life insurance — sometimes known as life cover or life assurance — is an insurance policy contract between yourself and an insurance provider.
Life insurance is a way to ensure that your loved ones will be financially secure if the worst should happen and you are no longer around to provide for them. It can also help minimise the financial impact and burden that your death can have on your family such as funeral costs.
Arranging a policy can give you peace of mind and provide much-needed financial security for your family.
What is the difference between life insurance and life assurance?
Often, you’ll hear people interchange between “life insurance” and “life assurance”, as if they mean the same thing. They do, as a matter of fact, mean slightly different things, so it’s important to be aware of the differences.
How does life insurance work?
Most life insurance policies are designed to pay out a cash sum to your loved ones if you die during your policy.
To start your insurance policy you’ll first choose the amount of cover you need and how long you’ll need it for. Through this, you’ll then pay regular premiums on a monthly or annual basis.
As with every insurance policy, it’s best to read the terms and conditions as every provider has its own set of policy conditions and exclusions. For example, if death occurs through suicide, a drug overdose, or a “risky or reckless act”, a lot of providers will refuse to payout.
It is always best to take the time to read through your policy documents and ask your chosen life insurance company for clarification if there's anything you don't fully understand.
How much life insurance do I need?
The amount of life insurance that you’ll need will differ from person to person, and there are many factors that go into deciding which life insurance policy is best for you. However, there are several key questions that you’ll need to ask yourself in order to determine the right amount of cover for you:
How many people are financially dependent on you? — Including your children, spouse or partner.
How much would your death impact them? — Would they be financially stable enough to continue their lives in the same way if you weren’t here?
Do you have a mortgage that needs to be covered? — It’s important to make sure that all bills can be paid.
Do you or your family have other debts? — Your family will still be chased if you or they have any outstanding debts that need to be paid.
Do you have savings that your family could use? — Do you have enough money saved up that your family could use in the event of your death? How long would they be able to survive off of this?
Are there any future spending costs you need to account for? — E.g private education for your children or university costs.
What death-in-service benefits does your employer offer? — If your employer does offer death-in-service benefits, it’s best to check in your employment contract to be sure.
A simple rule of thumb is to cover 10 times the main breadwinner’s income, but of course, that’s just a guide and everyone’s situation is different. Ten times a salary might sound a lot, but inflation can eat into the value of any payout.
If you’re interested in protecting your income, read our guide to the best income protection insurance to help find the best deal.
As life insurance quotes can vary dramatically depending on the amount you want to cover, it’s important that you always use the same details — of how much cover and how long for — when you get a quote to compare life insurance companies.
What’s the average cost of life insurance?
On average, life insurance costs between £7.33 - £11.09 a month, based on quotes we received in January 2022 for a 35-year-old non-smoker with a clean medical history who has chosen a level term life insurance policy.
If you’re over 50 or suffer from a serious medical condition, it is possible that you may pay more for your life insurance. If you opt to add critical illness cover to your policy, this will increase the cost of cover, sometimes by a similar amount to the life policy.
It’s important to remember that your life insurance policy will depend entirely on several factors that can influence the cost of your premiums. These factors include:
Lifestyle — If you lead an unhealthy lifestyle, this can increase your premiums drastically. Factors such as whether you smoke, are a heavy drinker or are overweight can shorten your life expectancy and your premiums will be typically higher to reflect this.
Health — If you have any pre-existing medical conditions, this can increase the price you’ll pay. Some serious or more chronic medical conditions can also influence the price of your premium.
Age — Typically, the older you are, the more expensive your policy will be. As you get older, you’re at a higher risk of developing a medical condition that can affect your life expectancy. Someone who is 35 will pay significantly less than someone who is 65.
Occupation — If you work in a job that could be considered more dangerous, you may end up paying more as compared to someone who works in a lower risk job.
Family medical history — If your family has a history of serious medical conditions, this could impact the price you’ll pay as your insurer may say that you’re at a greater risk of suffering from the same condition.
Length of cover — If you opt for a policy that has a longer term, you’re likely to pay more than choosing a policy with a shorter term.
Amount of cover — As is the case with most policies, you’ll decide how much you’d like to be covered for. Usually, the higher the cover, the higher your premiums will be.(Video) What Types Of Life Insurance Policies Are The Best?
Most life insurance premiums are fixed so your monthly premium is likely to never increase. Life insurers should tell you how long it will take for you to pay as much in premiums as the policy will payout when you die.
What are the different types of life insurance policies?
Instead of looking for the cheapest life insurance that you can find, it’s important to work out which type of life insurance will be right for you and your needs. There are many different types of insurance policies that you can take, with everything from term life insurance, to over 50’s and critical illness cover.
Term life insurance
Term life insurance can offer the best value for those who are looking for cheap life insurance. It insures you for the term of the policy, paying out if you die before the policy ends. If you don’t die before your policy ends, the premiums you’ve paid will not be returned.
There are two main types of term insurance — level term life insurance and decreasing term life insurance policies.
Level term life insurance
Level term insurance is where your insurer will pay out a fixed sum if you die within the terms agreed in your policy. This fixed sum must have been agreed upon when the policy was taken out.
Those who are named as the beneficiaries of your policy can receive a specific sum of money, which can help plan for a time when you may no longer be around. Level term insurance is a good option for when you want to cover a specific amount of money which can help pay off any outstanding debts that you may have when you die such as an interest-only mortgage.
In the UK, comparison websites often use level term life insurance as the basis for producing life insurance quotes, but it’s sometimes not always the best route to keeping costs down.
Decreasing term life insurance
With a decreasing term life insurance policy, the amount of cover will decrease over time, although your premiums are usually fixed and will remain the same for the duration of your policy.
The type of life insurance is often used to cover debts that will reduce over time. This includes a repayment mortgage where the outstanding balance will gradually get smaller over time. Often, a mortgage lender will insist that you either have or take out a life insurance policy with your mortgage.
If you are looking for cheap life insurance then, provided you understand that your cover will decrease over time, decreasing term life insurance can be a good idea as it is often significantly less expensive than level-term cover. As well as mortgage cover, this type of policy is also useful for inheritance tax planning purposes.
How much does term life insurance cost?
As with any type of insurance policy, the costs can vary because factors such as your age, the size of the policy, your medical history and lifestyle factors can have a significant impact on how much you’ll pay. In general, however, your life insurance policy will begin to rise in cost with age.
According to ActiveQuote, in January 2022, for a level term policy, you can pay between £7.33 - £11.09 per month for a 35-year-old male who has a clean medical history and is a non-smoker. For a decreasing term life insurance policy, ActiveQuote quoted that it will cost between £6.69 - £9.36 per month.
You can compare the best life insurance companies in the UK and receive a quote today from ActiveQuote.
Over 50s life insurance
Sometimes known as Over 50s life cover or lifelong protection, over 50s life insurance is a specific type of policy that is designed for those aged 50-80 years old. Instead of the usual health questionnaires, medical questions and assessments, everyone aged between 50 to 80 is guaranteed to be accepted.
Typically, Over 50s life insurance can also be known as ‘whole of life’ cover, which essentially means that it’ll last your lifetime. But, this type of life insurance also has a qualifying period — which is often 12 or 24 months — which means if you die during this initial period, you’ll only have any premiums paid returned to you; your family won’t receive the cash lump sum.
How much does over 50s life insurance cost?
According to ActiveQuote, the cost of Over 50s life insurance can start from just £5 a month, depending on the level of cover that you require and factors such as your age and whether you’re a smoker or not.
Whole of life insurance
A whole of life insurance policy guarantees that your family will get a payout when you die. It’ll provide cover for the whole of your life and you’ll pay a premium each month, and in return, the policy will pay out a lump sum.
With whole of life policies, your chosen insurance provider will invest your premiums into a life fund that then spreads its investments across the stock market, bonds, property and cash.
An important thing to remember is that if the fund’s investments perform poorly and the provider is concerned that there is not enough money in the pot to cover everyone’s payouts, you may be asked to increase your premiums — despite the fact that the cover you receive stays the same.
How much does whole of life insurance cost?
According to ActiveQuote, policies can start from just £5 a month. However, a variety of factors will affect the cost of your whole life insurance policy, including:
Whether or not you smoke(Video) Indexed Universal Life (IUL) vs Whole Life Insurance | 2022 UPDATE
Your health and medical history
The number of people on your policy
The amount you wish to payout when you die
Essentially, the higher the risk of you dying young, the higher the premium you will pay. Similarly, women often pay less with whole of life insurance policies as they tend to live longer than men.
When you’re applying for a life insurance policy, you may sometimes be offered the option to add extras to your policy.
Critical illness cover
Many people decide to take out critical illness cover at the same time they take out their life insurance. Critical illness cover will put aside a portion of your payout that you could use if you suffer a predetermined critical illness, become terminally ill or suffer from a serious illness.
If you suffer from any of these, then your policy will automatically end as soon as it happens.
Life insurance with critical illness cover can vary widely in terms of which conditions are covered, with some far more comprehensive than others. The average policy covers around 35 illnesses, while the most comprehensive might cover over 150, some of these being:
Certain forms of cancer
It’s important that you look closely at the list of conditions as some forms of cancer are not included because they’re easy to treat and most people should recover.
You can compare critical illness quotes and policies using specialist comparison site ActiveQuote.
While it’s not the brightest of topics, it’s important to consider how your family would pay for your funeral in the event that you would pass away. You can easily add funeral cover to your life insurance policy — some policies even have it already included.
Life insurance with funeral cover
Whole life insurance policies will pay out an agreed amount on your death to cover the costs of your funeral. Many people even take out policies simply to cover the cost of their funeral.
However, it’s important to remember that there is likely to be a delay between your death and your life insurance paying out.
Some people prefer to opt for a pre-paid funeral plan that is often marketed on the basis of “freezing the costs” of a funeral. Put simply, a funeral plan allows you to pay upfront for your funeral so your relatives don’t have to cover the costs themselves.
This can also bring you peace of mind, knowing that you’ve paid for your funeral in full in advance.
Read our guide to the best funeral plans to see how much you can pay a month.
Pay out of your estate
If you are planning on using your savings to cover funeral costs make sure the money is held in a joint account that your family can easily access after your death. The best account to use is a joint account where the surviving joint owner immediately takes over sole account ownership and can continue to withdraw money without assets being frozen.
Free parent life cover
Some insurance companies offer free life insurance for new parents, this means that they will give you a certain amount of money if you pass away before your child is of a certain age. This means that you won’t have to pay a premium or any excess and the cover will usually last for one year from when you are accepted onto the policy.
Both you and your partner can apply, meaning you are both covered if something happens to you.
Other insurance policies
There are also other life insurance policies to consider when you take out a policy. This can include:
Terminal illness cover — This cover can payout early if you’re diagnosed with a terminal illness, from which you’ll die within an estimated and limited time period.
Joint life insurance — When you take out your life insurance policy, you can choose between a single policy or a joint policy for couples. If you and your partner are both taking out a policy at the same time, it can sometimes be cheaper to opt for a joint policy instead.
While sometimes these optional extras can raise the price of your insurance, sometimes it’s better to be prepared for the unexpected.
Medical conditions and life insurance
Any life insurance quote will depend heavily on the information you supply as well as your medical information. Customers who have diabetes, for example, will likely have a more expensive policy that may be complicated to arrange.
Life insurance may sometimes be harder to find if you suffer from a long-term or serious health problem.
Lifestyle and life insurance
While medical conditions and terminal illnesses are the most difficult issues to resolve, lifestyle choices can also significantly affect your premiums.
Problems such as cirrhosis — which is caused by heavy drinking — can leave you paying over the odds for your insurance. However, being overweight or smoking can drastically increase the cost of your life cover. And it’s not just smoking: vaping can also increase the costs of your policy as companies consider vaping to be just as serious as smoking.
It’s important that you don’t hide the truth about your lifestyle choices and insurers don’t have to pay out if an applicant has hidden an important detail when applying for cover.
Life insurance exclusions
Some life insurance companies will exclude certain people from their cover as they are considered to be too high of a risk to insure. Some of the reasons insurers may turn down your application include:
You work in a “high risk” job
You regularly take part in “high risk” leisure activities
You suffer from serious health problems such as cancer or diabetes
You’re a heavy smoker
Some life insurance policies also state that they will not pay out if death occurs under the following circumstances:
Drug or alcohol misuse
Involvement in war or terrorism
Suicide or self-inflicted injuries
Gross negligence or a similarly reckless act
Who is the number 1 life insurance? ›
Term life insurance is the most popular type for a few reasons. First, it is affordable. Term life premiums are based on your age, health, and the amount of coverage you need.What life insurance company has the most policy holders? ›
According to a 2021 NAIC report, Northwestern Mutual, New York Life, Metropolitan, and Prudential are the four largest life insurance companies in the United States, all together holding 31.09% of the market. Some insurance companies offer riders, which are benefits added to policies, allowing for customization.What is the most cost effective type of life insurance? ›
Term life insurance is usually the most affordable life insurance policy option, but which company has the cheapest rates? We analyzed the term life insurance rates of 26 top companies to determine the cheapest life insurance companies.What life insurance never goes up? ›
There are 2 main types of permanent life insurance: traditional whole life insurance and universal life insurance. With a traditional whole life insurance policy, you'll pay a fixed premium for the entire length of your policy, meaning your required premium payments will never go up.How much is $100000 in life insurance a month? ›
The average monthly cost of life insurance for a 10-year $100,000 policy is $11.02 or $12.59 for a 20-year policy.What is the most trusted insurance company? ›
- USAA. 4.3. U.S. News Rating. USAA is the best insurance company in our ratings. ...
- State Farm. 4.2. U.S. News Rating. ...
- Farmers. 4.1. U.S. News Rating. ...
- Nationwide. 4.1. U.S. News Rating. ...
- Geico. 4.1. U.S. News Rating. ...
- Allstate. 4.0. U.S. News Rating. ...
- Travelers. 4.0. U.S. News Rating. ...
- Progressive. 3.9. U.S. News Rating.
Choose a Plan Type
If budgeting is your biggest concern, term life insurance may be the best choice. If you have many dependents, whole life insurance may be a better route. However, if financial planning and cash value are most important to you, universal life insurance may be a strong option.
- Assess your life insurance goals. ...
- Calculate the optimal insurance cover that you need. ...
- Determine the amount you have to pay as the premium and find the policy offering the best deal. ...
- Select the correct policy term. ...
- Opt for a reputable life insurance provider.
State Farm is the number one auto insurer in the U.S., followed by Geico, Progressive, Allstate and USAA. State Farm has a market share of 16% for car insurance, and the company sells policies online as well as through agents across the country.
What is the number 1 insurance company in the world? ›
High-risk life insurance is a class of life insurance for people who are considered an increased risk to insure. You could be considered a high risk if you have a profession or hobby that puts you in life-threatening situations. Also, insurance companies can consider you a high risk if you have below-average health.What is a good price to pay for life insurance? ›
Rule of thumb: Most financial planners recommend an amount 10-15x your current income. Life insurance rates are influenced by a number of factors, but your health has the biggest impact on the final cost.How much does a $50000 life insurance policy cost per month? ›
How Much Is A $50,000 Term Life Insurance Policy ? A $50,000 life insurance policy costs around $7.63 per month for a 36 year old female in excellent health looking at a 10 year term and $9.21 per month for a male in excellent health looking for the same coverage.What are the 2 most common types of life insurance? ›
Types of life insurance explained. There are two primary categories of life insurance: term and permanent. Term life insurance lasts for a set timeframe (usually 10 to 30 years), making it a more affordable option, while permanent life insurance lasts your entire lifetime.At what age is life insurance no longer needed? ›
You may no longer need life insurance once you've hit your 60s or 70s. If you're living on a fixed income, cutting the expense could give your budget some breathing room. Make sure to discuss your needs with an insurance agent or a financial advisor before making any major moves.What age is too late to get life insurance? ›
At what age can you no longer buy life insurance? 90 years old is the highest issue age we've seen from any life insurance company. But many companies won't issue policies to people older than 85.What is better term or whole life? ›
If you only need life insurance for a relatively short period of time (such as only when you have minor children to raise), term may be better as the premiums are more affordable. If you need permanent coverage that lasts your entire life, whole life is likely preferred.Is life insurance worth it after 60? ›
If you retire and don't have issues paying bills or making ends meet you likely don't need life insurance. If you retire with debt or have children or a spouse that is dependent on you, keeping life insurance is a good idea. Life insurance can also be maintained during retirement to help pay for estate taxes.How much does a $1000000 whole life insurance policy cost? ›
How Much Is a $1 Million Life Insurance Policy? The cost of a $1,000,000 life insurance policy for a 10-year term is $32.05 per month on average. If you prefer a 20-year plan, you'll pay an average monthly premium of $46.65.
How much is a 250k whole life insurance policy? ›
How Much Is a $250,000 Life Insurance Policy? On average, a $250,000 life insurance policy costs $14.75 per month for a 10-year term and $18.09 for a 20-year term. The right term length for you will depend on your financial needs.What are the big 3 insurance companies? ›
The insurance sector, however, has a few bright spots. Three of the world's 20 largest insurance companies – AXA Group, Chubb, and American International Group (AIG) – moved up the rankings, with AIG registering the biggest improvement, rising from 439th last year to claim the 90th spot in 2022.What are the 3 main types of life insurance? ›
Common types of life insurance include: Term life insurance. Whole life insurance. Universal life insurance.What insurance companies do not want you to know? ›
- Your car insurance may not be tied to the driver.
- The type of car you drive matters.
- Prior claims and questions raise rates.
- You can check your report for errors.
- Your credit score impacts your car insurance costs.
- Where you live impacts your premium account.
While you can buy multiple life insurance policies, the total number you can have often depends on the coverage amount. Many life insurance companies will deny additional applications if they believe you're overinsured.Is it OK to have 2 life insurance policies? ›
The short answer is yes. You can have more than one life insurance policy, and you don't have to get them from the same company.What is the downside of life insurance? ›
One of the biggest disadvantages of life insurance is that it can be quite expensive. Life insurance costs depend on factors such as age, health, and lifestyle. If you're young and healthy, you'll likely pay less for life insurance than someone older or with health problems.How much is a good life insurance policy per month? ›
The average cost of life insurance is $26 a month. This is based on data provided by Quotacy for a 40-year-old buying a 20-year, $500,000 term life policy, which is the most common term length and amount sold.Is it better to get life insurance through your bank? ›
Is it cheaper to buy life insurance with your bank? In most cases, no. Your bank won't shop around for you and so the price you are offered may well be significantly higher than the cheapest policy on the market.Who is the #1 insurance company in USA? ›
State Farm is the number one auto insurance company in the country in terms of market share and premiums written, followed by Geico, Progressive and Allstate.
Who is the top 10 insurance company? ›
- Bharti AXA Life Insurance Company.
- Bajaj Allianz Life Insurance Company.
- HDFC Life Insurance Company.
- LIC Life Insurance Company.
- Pramerica Life Insurance Company.
- Exide Life Insurance Company.
- Kotak Mahindra Life Insurance Company.
- Reliance Nippon Life Insurance Company.
|1||UnitedHealth Group||United States|
|2||Ping An Insurance||China|
|3||China Life Insurance||China|
|4||Centene Corporation||United States|
Financial ratings comparison of top auto and home insurance companies.
|Insurer name||Rating (A.M. Best)|
State Farm is a mutual company, which means that the company is owned collectively by State Farm policyholders, and not by shareholders.What is a Tier 1 insurance company? ›
Tier 1 usually includes a select network of providers that have agreed to provide services at a lower cost for you and your covered family members. Tier 2 provides you the option to choose a provider from the larger network of contracted PPO providers, but you may pay more out-of-pocket costs.What percentage of life insurance never pays out? ›
In fact, a study done by Penn State University indicates that 99 percent of all term policies never pay out a death benefit. However, that's because most term policyholders don't pay their premiums and let their policies lapse, not because they outlive the policy term, according to Entrepreneur.What age group is most likely to buy life insurance? ›
What age group buys the most life insurance? Young adults aged 18 to 34 are the most likely to buy life insurance, followed by 35- to 44-year-olds. This may be because young adults are starting families and want to ensure their loved ones are taken care of financially if they die prematurely.Why life insurance is not a good savings plan? ›
This is true, but life insurance is one of the most expensive ways to invest. Whole life policies pay low to mid-single-digit dividends. All types of policies add the cost of insurance, selling and administrative expenses, and a host of additional riders to the total cost.What is the cheapest way to get life insurance? ›
Term life insurance is the simplest and cheapest type of policy, and it's sufficient for most people. It lasts a set number of years, and it's designed to cover you while you have financial dependents or obligations, such as paying off a mortgage or raising children.How much does a 500k whole life policy cost? ›
The average cost for a 10-year, $500,000 term life policy is $200 a year. The average cost is around $275 a year for a 20-year term—if you buy life insurance in your 30s while in good health, including being a non-smoker.
How much life insurance should a 50 year old have? ›
What is the rule of thumb on how much life insurance coverage you need? Consider getting up to 30X your income between the ages of 18 and 40; 20X income at age 41-50; 15X income at age 51-60; and 10X income for age 61-65.How much is a 200000 whole life policy? ›
|60 Years Old||$199.52|
Term life insurance
Term is the most popular type of life insurance for most people because it's straightforward, affordable, and only lasts for as long as you need it. Term life insurance is one of the easiest and cheapest ways to provide a financial safety net for your loved ones.
Five independent agencies—A.M. Best, Fitch, Kroll Bond Rating Agency (KBRA), Moody's and Standard & Poor's—rate the financial strength of insurance companies. Each has its own rating scale, its own rating standards, its own population of rated companies, and its own distribution of companies across its scale.How much is $500000 life insurance a month? ›
Policy details like term length and coverage amount also affect premiums. A 40-year-old with excellent health buying $500,000 life insurance with a 10-year term will pay $18.44 per month on average. The same individual will pay approximately $24.82 per month for a 20-year term.Who is the largest life insurer in the world? ›
|Company (HQ)||Market capitalization in billion U.S. dollars|
Most experts agree that life, health, long-term disability, and auto insurance are the four types of insurance you must have.What is the #1 insurance company? ›
State Farm is the number one auto insurance company in the country in terms of market share and premiums written, followed by Geico, Progressive and Allstate.How do I know if my insurance company is good? ›
- #1: Check the insurance company's financial strength. ...
- #2: Check for proper state licensing, claims and complaints. ...
- #3: Consider a company's claims process. ...
- #4: Work with an independent agent who has relatable experiences with various carriers.
- Aflac Incorporated.
- Allianz Life Insurance Company of North America.
- Blue Shield of California.
- Cambia Health Solutions.
- CareFirst BlueCross BlueShield.
- Health Care Service Corporation.
- Marsh McLennan.
What are the two AAA rated companies? ›
1 And as of September 2022, only two companies held the AAA rating outright—Microsoft (MSFT) and Johnson & Johnson (JNJ). 23Apple is split with a Aaa rating by Moody's and a AA+ (one notch below AAA) from S&P.Whats better whole life or term? ›
If you only need life insurance for a relatively short period of time (such as only when you have minor children to raise), term may be better as the premiums are more affordable. If you need permanent coverage that lasts your entire life, whole life is likely preferred.Do billionaires buy life insurance? ›
Life insurance is a popular way for the wealthy to maximize their after-tax estate and have more money to pass on to heirs. A life insurance policy can be used as an investment tool or simply provide added financial reassurance.Who sold the most life insurance? ›
Ben Feldman (September 7, 1912 – November 7, 1993) was an American businessman and one of the most prolific salespeople in history. As early as 1979, Feldman had sold more life insurance than anyone in history.