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Read more…Life insurance statistics UK
Is the UK prepared for the worst?
It might not be something that you want to consider, but life insurance plays an important role in planning for your family’s financial future. We explored the latest statistics to find out how prepared the UK is for death. After all, as Benjamin Franklin said, “In this world, nothing can be said to be certain, except death and taxes”.
Life insurance falls under the broader category of protection insurance. Protection insurance includes life insurance but also other types of insurance, such as income protection and serious illness insurance.
Quick overview
- It is estimated that 18.6 million people in the UK had life insurance in 2022, which equates to 35% of the adult population.
- 20.4 million policies taken out in 2021 – 1.5% less than in 2020 (20.7 million).
- 3.1 million new individual and group protections were taken out in 2021.
- £4.64 billion was paid out in protection policies in 2022 – £12.7 million each day on average.
- There are 402 authorised insurance companies in the UK in 2022.
How many people have life insurance?
It is estimated that 18.6 million people in the UK have life insurance, which equates to 35% of the adult population. It is important to note that people are not restricted to one life insurance policy, which explains why the total number of life insurance policies is higher than 18.6 million.
How many life insurance protection policies are taken out in the UK?
Life insurance protection policies have decreased since 2014. In 2021, there were 20.4 million policies taken out, which is 30% less than in 2014 (29.3 million).
| Year | Protection policies |
|---|---|
| 2014 | 29,300,000 |
| 2015 | 28,600,000 |
| 2016 | 26,900,000 |
| 2017 | 25,700,000 |
| 2018 | 25,200,000 |
| 2019 | 23,700,000 |
| 2020 | 20,700,000 |
| 2021 | 20,400,000 |
How common is life insurance in the general insurance market?
Life insurance premiums take the majority of the market share of total insurance premiums. Since 2000, life insurance has averaged 71% of the insurance premium market share. The last year of data was 2021, where life insurance market share was 70%. In 2007, the market share stood at its highest level at 83%.
| Year | Year |
|---|---|
| 2000 | 72.30% |
| 2001 | 66.20% |
| 2002 | 63.10% |
| 2003 | 58.90% |
| 2004 | 61.80% |
| 2005 | 64.40% |
| 2006 | 79.60% |
| 2007 | 83.20% |
| 2008 | 76.30% |
| 2009 | 76% |
| 2010 | 73.60% |
| 2011 | 73.50% |
| 2012 | 75.40% |
| 2013 | 72.40% |
| 2014 | 73.40% |
| 2015 | 73.30% |
| 2016 | 68.80% |
| 2017 | 69% |
| 2018 | 72% |
| 2019 | 72.60% |
| 2020 | 70.50% |
| 2021 | 70.49% |
Main reasons for life insurance claims
In 2022, cancer (34.2%) was the biggest reason for a life insurance claim. Heart-related claims were second at 21%, followed by neurological reasons (6.1%), Pneumonia (4.1%) and COPD (3.9%). COVID-19 claims accounted for 13%. However, this figure plummeted in 2022 to 1.3% of all claims paid. The number of COVID-19 claims dropped from 10,606 in 2021 to 3,846 in 2022.
| Reason for taking out life insurance | Percentage |
|---|---|
| Cancer | 34.20% |
| Heart related | 21% |
| neurological | 6.10% |
| Pneumonia | 4.10% |
| COPD | 3.90% |
| Other | 30.70% |
Life insurance payouts in the UK
Each policy taken out is unique – but how often do insurers typically pay out for life insurance and how much?
- £4.64 billion was paid out in protection policies in 2022 – £12.7 million each day on average.
- 287,000 payouts were made to customers in 2022.
Average payout and total claims by type of insurance
| Type of policy | Number of claims paid | Average value of claims paid | Percentage of claims paid |
|---|---|---|---|
| Whole of life | 213,064 | £4,054 | 99.99% |
| Life insurance | 53,105 | £73,578 | 96.90% |
| Income protection | 22,542 | £21,913 | 84.40% |
| Critical illness | 19,218 | £66,296 | 91.60% |
| Total permanent disability | 342 | £70,414 | 70.30% |
| TOTAL | 308,270 | / | 97.50% |
Sources used
- ONS
- ABI
- OECD
- Royal London
- The Money Charity
- More Than
- Sunlife
- Direct Line
Click here for more research. For all media enquiries, please contact
Matt Mckenna
Head of UK communications
T: +44 20 8191 8806
Head of UK communications
T: +44 20 8191 8806
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