Cheapest life insurance in the UK

Life insurance can be incredibly expensive, yet there are ways to get a cut-price deal that's right for you.

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Life insurance can be a much needed safety net if you have a partner and children to look after. You can provide for them after you’re gone or simply make sure they’re not landed with hefty debts and funeral costs.

How much you pay can vary drastically though and will depend on factors such as your health, your age and whether you smoke.

Unfortunately, there’s not much you can do about the number of years you’ve clocked up or if you have a pre-existing medical condition.

However, there are cheaper types of policies you can go for, and there are some tactics you can use to really lower those pesky costs.

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What’s the cheapest type of policy?

When it comes to life insurance, there are two main types of policy: whole life and term life. If you’re looking to get the cheapest deal possible, then you’re probably after term life insurance.

Term life will cover you for a set period of time, from between 5 and 30 years, and will pay out to your beneficiaries if you die during the agreed policy duration.

It’s typically cheaper than a whole life policy as there’s no guarantee the insurer will have to shell out any money. Should you live past the end policy date then there’s no payout.

When does it make sense to buy the cheapest life insurance?

The obvious reason to take out the cheapest life insurance is if you can’t afford a more comprehensive one. Yet you might also go for the budget option if it’s the only cover you require.

If you only want life insurance to cover you for a specific debt like a mortgage, for instance. Taking out a cheaper term life policy could provide you with a financial safety net just while you pay it off.

What affects the cost of life insurance?

Insurance companies take into account a number of factors when working out the price of your life insurance, such as the following:

  • Age
  • Health
  • Family’s medical history
  • Lifestyle (e.g. do you smoke?)
  • Occupation
  • Hobbies

How can I lower my life insurance rates?

There are many ways to lower your insurance premiums:

  • Shop around. Use price comparison websites and get quotes from various companies before committing. Avoiding the urge to take out the first decent looking deal is by far the easiest way to cut costs.
  • Only pay for the cover you need. Buying a policy that suits your needs is crucial for getting a cheap deal in the long term. If you only need life insurance protection while your kids are growing up, you might decide you don’t need a whole life deal.
  • Quit smoking. Stub out your smoking habit, and after 12 months, insurance companies might treat you as a nonsmoker and lower your costs.
  • Keep active. By staying fit and keeping your weight in check, you can convince your insurer you’re less of a risk. In turn, this could earn you lower insurance premiums.
  • Joint policies. Taking out a policy with your spouse can mean lower insurance costs, although it will only pay out when the first one of you dies. Should you have children to take care of, it might not be a great idea.

How to get cheap life insurance if you’re aged over 50

Once you’re in your 50s, it can be harder to get an affordable life insurance deal, particularly if you have suffered from a serious health condition.

Insurance companies might well hike your prices or refuse to cover you at all, depending on the illness or injury. However, there are a few other options if you can’t get a term life policy.

Over 50s life insurance policies

Over 50s policies can help if you are struggling to find life insurance because of a pre-existing medical condition, as you don’t need to provide any details about your health to sign up.

As a type of whole life policy, your beneficiaries are guaranteed a payout if you keep your payments up. However, over-50s cover often works out as bad value for money if you live for 10 years or more.

You could well end up paying in more than the policy pays out.

Funeral cover

If you’re worried about the financial burden your funeral might put on your loved ones, a pre-paid funeral plan might be another option to look at.

The upside to a funeral policy is that the price of the ceremony and burial is often set at today’s prices. So if costs rise in a decade or so, you’ll end up saving a decent amount.

Be wary though, if prices somehow dip in the years to come, you won’t make any sort of saving. Another thing to look out for is that many of these plans won’t cover all funeral expenses.

Income protection insurance

Income protection insurance policies can offer you protection if your income suddenly dries up. Depending on the policy, you can be protected against sickness, an injury or being made redundant.

While it won’t pay out if you die, this type of cover can help maintain your standard of living if you can’t work.

Critical illness cover for over-50s

Critical illness cover will pay out a lump sum if you are diagnosed with a serious illness. Each insurer will have its own list of conditions, but a few of the main issues it covers include cancer, heart disease and stroke.

Frequently asked questions


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