Why is family life insurance important?

Arranging family life insurance is vital to provide financial stability for your loved ones if the worst were to happen to you.

If you were to pass away, could your family afford to:

  • Repay the mortgage?
  • Cover future family living costs?
  • Pay for childcare support?
  • Clear outstanding debt?
  • Provide an inheritance?
  • Cover rising funeral costs?

Unfortunately, it’s a sad fact that a child loses a parent every 22 minutes in the UK[1].

This highlights the importance of securing the right financial protection for your family.

A life insurance policy can give you peace of mind that, if the unexpected happens, your family could continue their current lifestyle and manage financially.

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What is family life insurance?

Family life insurance is simply a way of describing life insurance taken out to protect your loved ones’ financial security if you were no longer around.

Watch our short video explaining what life insurance is, how it works and why most UK families would benefit from having it.

There are various policy options available to protect your family, including:

Some policies provide cover for a specified period of time (the term), while others offer lifelong cover. Others can be used in the event of serious illness or to protect your income.

Which option is right for your family will depend on what you want to protect, how long you’d like to be covered for, as well as your budget.

How much does family life insurance cost?

Families are often on a budget and life insurance may seem like another monthly cost to be factored in.

But securing the right cover to protect your family doesn’t have to be costly.

In fact, it’s possible to secure life insurance from just 20p-a-day through Reassured.

You’ll pay for your cover in affordable, monthly payments, known as life insurance premiums.

At the point of application, you’ll be asked a few health and lifestyle questions which will help to determine the price you’ll pay for your cover.

Below we explore the different types of life insurance and their average monthly costs.

Key factors used to calculate the cost of your premiums include:

  • Age
  • Smoking status
  • Medical wellbeing
  • Weight/BMI
  • Type of policy cover
  • Amount of cover (or sum assured)
  • Length of the policy term

If you have a young family it can be beneficial to take out life insurance at a younger age, while you’re in better health, as you could secure a more favourable premium.

At Reassured, we can arrange family life insurance from £1.40 a week.

Simply get in touch with our team for your free no-obligation quotes.

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How much life insurance do I need for my family?

When arranging life insurance, it's important to ensure your family is fully protected.

You should consider the following when looking to arrange life insurance to protect your family:

You should consider the various aspects of your family’s life you're looking to protect, as the sum of these will provide you with the level of cover required.

For example: outstanding mortgage + family daily living costs + outstanding debt + funeral costs = required sum assured.

UK statistics to help you calculate the level of cover you require:

  • £152,747 is the average cost of raising a child to 18 years[2]
  • £131,724 is the average mortgage debt in the UK[3]
  • One in ten UK residents have no savings[4]
  • £263.81 a week is the cost for full-time childcare[5]

At Reassured, we’ll take your personal circumstances into consideration and present you the available options to protect your family.

Allowing you to make a fully informed decision on your life insurance.

How much family life insurance do you need?

Enter your financial commitments below to understand the level of family life insurance cover you need.

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£121,687 is the estimated average outstanding mortgage per household in the UK.

Our property is generally the largest financial commitment any of us will make.

Your life insurance should cover this significant debt should you no longer be around.
£
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According to Money Advice Service, full-time childcare in the UK now costs £242 a week.

The loss of a parent could result in the need for additional childcare whilst the surviving parent increases their hours to account for lost income.

Your life insurance cover should factor in this additional required outgoing.
£
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The average level of debt (minus a mortgage) in the UK is £15,385.

Factoring in any outstanding debts in your name when arranging life insurance ensures this burden is not passed to loved ones.
£
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You may wish to leave your loved ones an inheritance or lump sum gift upon your passing.

Factoring in the gift amount when arranging your cover will ensure the pay out amount will be sufficient to provide your loved ones with this selfless gesture.
£
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According to SunLife, the average cost of a UK funeral is now £4,417, whilst the total cost of dying is £9,493.

This is a 130% increase over the past 16 years and shows no signs of slowing down.

A significant cost which should be factored into the amount of life insurance you secure.
£
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If you are one of the 65% of the UK who are lucky enough to have savings, this could be used as protection if you were to pass away.

Any pay outs from existing life insurance policies and investments can also be used as financial protection for your loved ones if you were no longer around.

Factor this into your required cover amount.
£ -

Your total cover estimate

£ 0

Let us find your best quotes.

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What is the best life insurance for a family?

The best life insurance to suit you and your family will depend on what you want to protect.

There are various types of family life insurance policies, each better suited to protecting certain aspects of your life.

Ultimately, it should be suited towards protecting the most important aspects for your loved ones as well as providing an adequate level of coverage, all whilst being within your budget.

Keep reading to discover more about each of these policies or get in touch to help you determine which is best for you...

Family term life insurance

  • Provides a lump sum pay out
  • Provides cover for a specified period of time
  • Cover up to £1,000,000
  • Term length up to 40 years
  • Level term or decreasing term policy options
  • Affordable premiums from 20p-a-day

The most common form of family life insurance is term-based cover.

Coming in the form of either level term or decreasing term, term-based cover provides you with protection for a specified period of time.

If you pass away during this term, a lump sum pay out will be made to your loved ones.

Level term life insurance will provide your loved ones with a fixed lump sum pay out, making it ideal for covering assets which don't change in value over time.

As a result, it's ideal for covering an interest-only mortgage, paying for your funeral or to provide an inheritance.

Decreasing term life insurance, on the other hand, provides a pay out which reduces in value over the life of the policy.

As a result, it's better suited to covering large costs which decline over time. For example, a repayment mortgage.

We’ve used our award-winning broker service to compare the cost of level term and decreasing term life insurance. Prices are based on a non-smoker in good health, for £100,000 cover, over a 20-year term:

AgeLevel term life insurance (20-year term)Decreasing term life insurance (20-year term)% Difference
20£3.61£4.36+21%
25£4.73£4.92+4%
30£4.82£4.99+4%
35£6.00£5.09-15%
40£7.87£6.05-23%
45£11.07£8.10-27%
50£16.18£10.99-32%


To compare level term and decreasing term life insurance quotes, simply get in touch.

Family income benefit

  • Provides on-going, tax-free, payments up to £5,000 a month
  • Provides cover for a specified period of time
  • Helps with long-term family budgeting
  • Term length up to 40 years
  • Low monthly premiums

Unlike traditional life insurance, which pays out a lump sum, family income benefit provides ongoing, tax-free monthly payments.

Regular income payments start from the date you pass away, until the end of the policy term.

For example, if you have a 20-year policy with a monthly pay out amount of £2,000 and you pass away 5 years into the policy, you’re loved ones would receive £2,000 a month for the remaining 15 years.

This type of cover is ideal for replacing a lost income, covering daily living costs or paying for additional childcare if required.

Because the risk to the insurer reduces over time, as with decreasing term life insurance, family income benefit is usually a very cost-effective option.

Whole of life insurance

  • Guaranteed pay out
  • Provides cover for the rest of your life
  • Provides cover up to £1,000,000
  • Possible to pay in more than the sum assured
  • Cover from as little as 27p-a-day ±

Whole of life insurance lasts for the rest of your life and, therefore, guarantees a pay out.

As with traditional life insurance, upon your death a lump sum pay out is issued to your family.

Whilst this type of policy is often used for similar purposes as level term cover, depending on your age and how long you live, it’s possible to pay more in than it'll pay out.

For this reason, whole of life policies are typically better suited for those in later life, (perhaps with adult children or looking to cover their partner).

We’ve used our award-winning broker service to compare the cost of whole of life and level term life insurance. Prices are based on a non-smoker in good health, for £100,000 cover (over a 20-year term for level term):

AgeWhole of life insuranceLevel term life insurance (20-year term)
20£61.03£3.61
25£64.86£4.73
30£71.01£4.82
35£82.93£6.00
40£100.90£7.87
45£124.34£11.07
50£150.50£16.18


At Reassured, we can compare both whole of life and term life insurance policies to help you find the right solution - get in touch for your free quotes.

Joint family life insurance

  • Covers two lives simultaneously
  • Approximately 25% cheaper than two single policies
  • Pay one monthly premium
  • Only provides one pay out
  • One application form to complete

Arranging joint life insurance can save, on average, 25% on your monthly premiums.

Therefore, for families on a tight budget, it can seem like an appealing option.

However, the biggest downfall with joint cover is it'll only pay out upon first death.

This can leave the surviving partner uncovered and having to arrange new cover at a later stage in life when they're likely to experience higher premiums.

Equally, when joint life insurance is used to protect two parents, if both were to pass away simultaneously, the pay out may not be sufficient to cover this twin loss.

As a result, if your budget allows, it may be more beneficial to arrange two single life insurance policies.

We’ve used our award-winning broker service to compare the cost of two single policies and a joint policy. Prices are based on a non-smoker in good health, for £100,000 cover over a 20-year term:

AgeJoint policyTwo single policies% Saving
20£6.25£7.22-13%
25£7.13£9.46-25%
30£8.79£9.64-9%
35£10.58£12.00-12%
40£14.30£15.74-9%
45£21.08£22.14-5%
50£31.53£32.36-3%


To compare both joint and single policies, contact our award-winning team to receive your free quotes.

Critical illness cover

  • Provides a tax-free lump sum
  • Cover if diagnosed with a serious illness (listed within your policy)
  • Available up to age 70
  • Covers a wide range of illnesses
  • Available as part of your life insurance policy
  • Available as a standalone policy

Life insurance policies provided through Reassured (except over 50s plans) have the ability to upgrade to include critical illness cover for an additional cost.

Critical illness cover provides you with a lump sum pay out if you're diagnosed with a serious, yet non-life-threatening illness.

This pay out can help your family by replacing lost income, paying for private medical treatment or funding necessary home adaptations.

Some policies also offer protection for children. So if your child becomes seriously ill, you can make a claim for them and receive a percentage of your pay out amount.

Not all policies will cover children so it’s important to compare quotes to find the right protection for you and your family.

Why not let Reassured help save you time and money by comparing quotes?

Income protection insurance

  • Protect your income
  • Short term and long term options available
  • Can pay out 50 - 70% of your gross income
  • Affordable monthly premiums
  • Policies to suit every need

Income protection insurance is an insurance policy that will pay out to you to replace a percentage of your income if you’re unable to work, (often up to 70%).

This could be as a result of accident, sickness or unemployment (depending on your chosen policy type).

Cover can be taken out on a short term or long term basis and can be more or less comprehensive depending on the policy type.

Rather than a lump sum, you’ll receive your payments in monthly, tax-free instalments which can help with family budgeting.

If you were unable to work, income protection payments could help your family by providing the funds to cover:

  • Mortgage or rental payments
  • Bills and utilities
  • Daily living costs
  • Childcare costs
  • Cover debts (such as credit cards or loans)

This form of cover can be particularly beneficial for families with self-employed workers, as they won’t benefit from sick pay.

Unfortunately, we can’t currently compare income protection quotes for you at Reassured).

Can I have multiple family life insurance policies?

It’s perfectly legal to have more than one life insurance policy in place simultaneously to protect your family.

Different policy types are better suited to protecting different elements within your life.

So, if it’s within your budget, you may choose to take out multiple policies.

For example, a decreasing term policy to protect your repayment mortgage and family income benefit to cover day-to-day living expenses.

Contact our award-winning team to compare quotes for a combination of policies to meet your unique needs.

Compare Family Life Insurance Quotes »

Which family member should secure cover?

When deciding which family member should secure cover, it’s important to consider the financial impact their death would have on your family’s lifestyle.

For example, both parents should secure cover in case the worst were to happen.

If one parent passes away, could the other cope financially as well as taking on additional childcare?

The unpaid work of a stay-at-home mum is estimated to be worth over £100,000 a year[6], which highlights the need for protection to ensure these costs are covered.

Cover for both parents could be taken out through a joint policy, although this will result in only one pay out or through two separate policies.

Why not speak to our team to compare single and joint quotes for you and your partner?

Life insurance for family members

It’s possible to arrange life insurance on behalf of a family member and the process isn’t entirely different to arranging your own.

For example, you may wish to arrange a policy for an elderly parent who may struggle to find cover on the own.

The person with whom the policy resides will remain the policyholder.

They'll be required to provide all of the necessary health and medical information and the rights to the policy remain theirs.

This includes the right to cancel the policy.

To discuss options for arranging cover on behalf of a family member, please contact Reassured.

What if you extend your family?

Throughout family life, it’s likely your personal circumstances will change.

Extending your family or moving to a larger family home are scenarios that are likely to require alterations to the level of life insurance cover you require.

Some life insurance policies include a ‘special events’ option, which will allow you to make the necessary changes to your policy.

This means that your sum assured can be altered and your premiums adjusted accordingly, without the need for additional underwriting.

However, this option isn’t offered by all providers and will only be available on some policy types.

It’s important to re-evaluate the cover you have in place should your family situation evolve.

Can I buy life insurance for my child?

It’s possible to secure life cover for children through some providers. However, this may not be the most beneficial option.

Due to no loss of income impacting the ability to meet daily living costs, it’s often not deemed essential to secure life insurance for your children.

Instead, it’s far more beneficial to secure life insurance for yourself and therefore, protecting the financial future of your family.

Some critical illness cover policies include cover for children, so this can be an efficient way of securing cover for both you and your child.

Write your policy in trust (so your family receive a full & faster pay out)

Writing your life insurance in trust allows your loved ones to make the most of your selfless investment.

It passes the rights of your policy over to a trustee (similar to the executor of a will), which results in the following benefits:

  • Avoid/reduce inheritance tax by detaching the value from your estate (40% over £325,000)
  • Receive a faster pay out by bypassing the probate process
  • Have more control over how and when the proceeds are distributed by stating your wishes to the trustee

At Reassured we offer a free trust writing service on the majority of the policies we arrange, providing peace of mind that your application is completed correctly.

Simply contact our customer service team today and we'll be happy to help.

How can I make sure my family is protected?

You can protect your family and secure their financial future by taking out the right financial protection.

By using an FCA regulated life insurance broker, such as Reassured, we could save you time and source a variety of quotes so you can choose the right type of cover for you.

Even those with high-risk life insurance factors may still be able to achieve cover through our award-winning service.

We have an impaired life insurance team who have helped arrange cover for 45% of customers declined elsewhere.

Simply contact our team today to start your journey towards protecting your family.

Tips for cheap family life insurance

Families often have to survive on a tight budget, making it important to arrange life insurance as cost-effectively as possible.

Below are 5 top tips to ensure you pay as little as possible for your life insurance:

  1. Always compare quotes to secure the best available deal
  2. Live a healthy lifestyle to help reduce the cost of premiums
  3. Arrange cover as soon as possible to avoid higher costs due to your older age or ill health
  4. Consider your most suitable type of policy to avoid paying for unnecessary cover
  5. Determine exactly how much cover you require, so you don’t pay for more than you need

Compare family life insurance quotes

The cost of family life insurance can vary significantly between insurers, making it essential to compare quotes before arranging your cover.

Using our brokerage will allow you to obtain all the information you need to make an informed decision on your best solution.

And our award-winning service comes at no charge to you.

We've arranged life insurance protection for over 1,000,000 families in the UK.

Simply get in touch today to obtain your free quotes and take the first step to protect your loved one's future.

Compare Life Insurance » Find Your Best Quote

Sources:

[1] http://www.childhoodbereavementnetwork.org.uk/research/key-statistics.aspx

[2] https://cpag.org.uk/sites/default/files/files/policypost/CostofaChild2020_web.pdf

[3] https://www.finder.com/uk/life-insurance-statistics

[4] https://yourmoney.lumio-app.com/uk-savings-statistics

[5] https://www.moneyhelper.org.uk/en/family-and-care/becoming-a-parent/childcare-costs

[6] https://www.channelmum.com/a/the-salary-mums-would-make-if-they-got-paid-for-childcare-revealed

Life insurance quotes above correct as of March 2021

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