Do high net-worth individuals need life insurance?

Life insurance, as well as many other forms of insurance, can be beneficial for those with a high net worth.

Life insurance provides a cash lump sum pay out to your loved ones should the worst happen to you.

If you’re a high net worth individual (HNWI) then protecting your assets for the benefit of your loved ones can be a key consideration. Life insurance can help you to ensure that they can continue living their current lifestyle with minimal financial disruption.

There’s also a range of insurance products for high net worth individuals (HNWI) known as ‘high net worth insurance’ to help you protect other aspects of your life. This isn’t something currently offered by Reassured.

Reassured can help you to secure a life insurance policy with a sum assured of up to £1,000,000.

We can also help you to secure multiple policies to provide multiple pay outs to cover various aspects of your life.

This article will look into why high net worth individuals need life insurance, how much it costs and much more, so keep reading…

Why do high net worth individuals need life insurance?

Due to having a lot of high value items, including property and possessions, those with a high net worth are likely to benefit from having life insurance in place for two main reasons:

  1. Help your loved ones continue their current lifestyle
  2. Help loved ones to pay off inheritance tax fees without dipping into their own funds

While you’re alive, everything you own, properties, money and possessions make up your estate.

When you pass away, your beneficiaries or next of kin will receive your estate.

In the UK, inheritance tax is charged at 40% on anything above a £325,000 threshold. As a high net worth individual it’s likely that your estate would well exceed this threshold.

By taking out a life insurance policy, you could write the policy in trust which can detach the policy from your estate, which means your loved ones won’t need to pay inheritance tax on the pay out.

This way your loved ones can receive a full pay out which can be used to help them cover the inheritance tax that will likely be charged on your estate, rather than them having to fund this personally or claim the funds from the estate.

Any additional funds can be put towards living costs or paying for your funeral.

Reassured offer a FREE trust writing service with the majority of the policies we sell. Simple speak to a friendly member of the team and they’ll be happy to help you through the process.

What is high net worth insurance?

High net worth insurance refers to a group of insurance products taken out by high net worth individuals to protect their possessions and assets.

Policies will often cover multiple areas of protection, such as:

  • Home insurance
  • Contents insurance
  • Travel insurance

By covering these aspects of your life, your assets can be protected while you’re at home and while you’re away.

Unfortunately, ‘high net worth insurance’ often doesn’t include life insurance and isn’t something we can currently provide at Reassured. So you’ll need to purchase an additional life insurance policy.

Why not use Reassured to compare quotes from some of the UK’s best life insurance providers to help you find the right policy to meet your needs.

What does high-net worth life insurance cover?

Life insurance can be used by those with a high net worth to help cover many aspects of your life so these expenses are taken care of for your loved ones should you pass away. This can include:

  • Mortgage(s)
  • Rental payments
  • Loans and outstanding debts
  • Daily family living costs
  • Children's education 
  • Funeral costs
  • Cover inheritance tax

If your loved ones were to fall on hard times financially after your passing, would they face the tough choice of having to sell off assets in order to find funds to continue living their current lifestyle?

Thankfully, a life insurance pay out can help provide the necessary funds to take care of many important expenses, as well as providing funds to help pay off any hefty inheritance tax bills.

This can help to minimise financial stress for your loved ones at an already stressful time.

Why not speak to an expert about protecting your loved ones? A friendly member of our team can provide you with information you need to make a fully informed decision.

Who qualifies for high-net-worth life insurance?

Your net worth is the sum of all of your assets, minus any liabilities. This includes:

Current value of your homeCredit card debt
Any other properties in your nameStudent loans
Vehicles (not including those on lease)Car finance
Bank accountsAny outstanding mortgage payments
StocksAny other loans
Household items
Any other assets of value

Since 2016, HMRC has defined a high-net-worth individual as anyone with assets in excess of £10 million.

In terms of life insurance, there’s no set definition of a high net worth individual.

What life insurance options are there?

There are multiple life insurance options available, each suited to protecting different aspects of your life. These include:

  • Level term life insurance
  • Decreasing term life insurance
  • Whole of life insurance

You can also layer additional policies for an extra financial safety net, such as:

  • Critical illness cover
  • Terminal illness cover
  • Income protection

Let’s look into these policy types in more detail…

Level term life insurance

Level term life insurance provides cover for a specified period of time (often this can be up to 40 years) and can provide a fixed pay out of up to £1,000,000.

A pay out will only be issued to your loved ones if you pass away during the term of the policy.

Due to the large pay out potential, level term life insurance is well suited to those wanting to protect large debts, such as an interest only mortgage, as well as protecting future family living costs.

Decreasing term life insurance

With a decreasing term life insurance policy, you’ll be covered for a specified period of time (up to 40 years) and your sum assured will reduce over the lifetime of your policy.

While you can choose a sum assured of up to £1,000,000 this will decrease over time.

If you have any loans in place that are likely to reduce over time, such as a repayment mortgage, securing a decreasing term policy can be ideal for helping protect these.

As with a level term life insurance policy, your loved ones will only receive a pay out if you pass away during the policy term.

Whole of life insurance

Whole of life insurance provides lifelong cover and guarantees your loved ones a pay out when you pass away.

With a whole of life policy it’s possible to secure a pay out amount of up to £1,000,000.

Whole of life insurance can be an ideal option for high net worth individuals to guarantee their loved ones an inheritance after their passing and ensure that essential costs are taken care of.

Critical illness cover

Critical illness cover can be added to a life insurance policy for an additional fee.

It will allow you to make an early claim on your life insurance policy if you’re diagnosed with a life changing (but not life threatening) illness that’s listed within your policy.

The pay out can then help you to pay for medical bills, make necessary adaptions to your home or pay for carers.

Terminal illness cover

Terminal illness cover comes at no extra cost with all term policies taken out through Reassured.

It provides the opportunity for an early pay out if you’re diagnosed with a life-threatening illness and predicted to pass away within 12 months.

The funds can then be used to help cover any private medical fees, help you get your financial affairs in order, or you could spend the funds enjoying time with your loved ones.

Income protection

Income protection will pay out a percentage of your usual income, in monthly (tax-free) instalments, in the event you become too ill or injured to work.

Income protection for high-net-worth clients can have some complications.

Firstly, those with a high net worth often have multiple sources of income and may be required to pay various taxes, which make it hard for income protection to be calculated accordingly.

Secondly, most standard income protection policies often have a maximum monthly benefit amount which may not come close to the amount needed for a high net worth individual.

However, some providers, such as Zurich, offer to pay out up to 80% of your annual net earnings up to a maximum of £20,000 per month. (This information has been taken from Zurich’s website and is correct as of 09/06/23).

This makes comparing income protection quotes essential to find the right level of cover to meet your needs.

Reassured can secure income protection quotes from Zurich, as well as all of the UK’s other leading providers, to help you find the best policy.

It’s not always the case of one policy or another, if you have different areas of life you’d like to protect, it’s completely possible to secure multiple life insurance policies.

For example, you could take out term life insurance to help cover any mortgages you may have as well as a whole of life insurance policy to guarantee your loved ones a pay out that can be used to help cover inheritance tax on your estate.

Why not speak to Reassured to find your ideal life insurance solution?

AIG high net worth life insurance

AIG are one of the UK’s leading life insurance providers and they offer a life insurance option specifically tailored to high net worth individuals.

This offering allows high net worth individuals to secure a higher level of cover than is typically offered to standard applicants.

As a high-net-worth applicant you’ll be referred to AIG’s premier service team and through their specialist product, you can secure up to:

  • £100 million level term cover
  • £52 million whole of life cover
  • £3 million critical illness cover

To qualify for this policy you must meet one of the following requirements:

  • Annual premium of £12,000
  • Life cover sum assured at least £10 million
  • Critical illness cover sum assured at least £2 million
  • High status client
  • Complex business protection case

This is something that can only be purchased through an AIG advisor and unfortunately is not something that we can offer at Reassured.

This information has been taken from the AIG website and is correct as of 09/06/23. This information is subject to change

How much is high net worth life insurance?

The amount you pay for your premium is decided by the insurer during the application process and will be calculated using key information. This includes:

Collecting this information allows insurers to determine the level of risk you’ll likely pose and your life insurance premium is calculated accordingly.

The older you get, the risk you pose increases, so securing cover at a younger age can help you lock in a more favourable premium.

Below shows the price breakdown of how much £1,000,000 (the maximum level) of cover would cost at each age.

These quotes are based on a non-smoker in good health, for a level term policy over a 20-year term:

AgePremium price for £1,000,000 of cover

Comparing quotes can help you to find a more favourable premium on a policy that meets all of your needs.

Is life insurance calculated in net worth?

No, life insurance isn’t calculated using your net worth. Instead the amount of cover you require can be calculated by adding together the sum of the expenses you’d like to cover.

How much cover you require can be calculated by adding together the sum of the expenses you’d like to cover, as well as any essential assets.

How much life insurance do you need?

Enter your financial commitments to understand the level of high net worth life cover you need.


£137,934 is the estimated mortgage debt per household in the UK.

The purchase of a home is likely to be the largest financial commitment any of us will make in our lifetime. Your life insurance should cover your remaining mortgage balance to allow your loved ones to stay in the family home should anything happen to you.



The average monthly household budget in the UK is £2,548 (that’s £30,576 per year), which is spent on transport, food & drink, utilities (gas, electricity, water etc), clothing, council tax and leisure activities.

With energy prices hitting a record high and the cost of living rising sharply in the UK, you may wish to factor in utility bills and family living expenses into your cover.



The average personal debt of UK adults has risen to £34,566 (not including mortgage debt), with credit cards, personal loans and overdrafts being the most common forms of debt.

Factoring in any debts into your life insurance cover means that, if they need to be paid back from your estate after your passing, your loved ones won’t miss out financially.



According to SunLife, the average cost of a funeral in the UK is £3,953 (with the overall cost of dying at £9,200).

Funeral costs have increased by 116% since 2004 and are a significant cost which should be factored into the amount of life insurance you secure.



When factoring in cover for your children, you may wish to calculate the amount based on how long it is until they reach financial independence.

This could include childcare (£7,000 per year for part-time care), school expenses (£1,519 per school year for uniforms, lunches, stationary etc), as well as an additional sum for further education (this could be a contribution of up to £5,000 per year).

Sources:, &


2 in 5 adults say they are relying on an inheritance to fund their retirement.

Factoring in an inheritance to your sum assured could allow loved ones to live a more financially comfortable life. Alternatively, you could leave a cash gift to a charity of your choosing.



If you’re lucky enough to have your own savings or are part of the 30% of UK residents who already have a life insurance policy in place, this can provide financial protection for loved ones.

By entering your current cover, savings or death in service amount you can reduce the sum assured you require.


£ -

Your total cover estimate

£ 0

Let us help you find your best quotes

What are the tax benefits of life insurance?

Those with a high net worth may experience the following tax benefits in terms of life insurance:

  • Avoid/minimise 40% inheritance tax for your loved ones
    As someone with a high net worth, it’s likely you have a large sum of property and possessions that make up your estate. When you pass away, 40% inheritance tax will be charged on anything over the £325,000 threshold. By writing your life insurance policy in trust, the pay out can become detached from your estate, ensuring that your loved ones receive a full pay out. The funds can then be used to help pay off any inheritance tax fees on your estate so your loved ones don’t have to use their own money or claim money back from the estate.
  • Pay for life insurance through your business
    If you’re a high net worth individual who owns a business, it can be possible to claim your life insurance as a business expense allowing you to benefit from tax relief. This will only be possible through a relevant life insurance policy, rather than an individual policy. Unfortunately, we can’t currently secure relevant life insurance policies at Reassured.

Speak to a friendly member of the team about writing your policy in trust, we have a dedicated team who will be happy to help you through the whole process.

Compare life insurance for high net worth individuals

Comparing life insurance quotes is the best way to secure the right policy to meet your needs.

By taking out cover through Reassured, we can help you to secure a policy with a pay out amount of up to £1,000,000.

We can provide you with all the information you need to make a fully informed decision.

We also have a dedicated team who can help you to write your life insurance policy in trust, free of charge, so your loved ones can avoid/minimise 40% inheritance tax.

The best part is, we don’t charge a fee for our quotes, so why not get in touch?

Related articles:

Our customers love us
Trustpilot Star Rating

Very easy to understand and very quick

Yes very pleased with my choice very helpful easy to understand and very pleasant transaction all good!

Mrs M Rushworth

Very professional and reassuring

Very professional and reassuring. Life insurance sorted in about 10 minutes.

Stephen Davies

very courteous and friendly

very courteous and friendly. Polite professional and empathic.

Stedroy Fenton

Another happy customer

Another happy customer I am. They are very professional and kind. Fully communicative. I recommend.

Piotr Stepien

Really attentive during the call

Really attentive during the call, good clear guidance throughout. Well done.

Michael Reynolds

Amazing service

Amazing service quick fast and easy and Joey was a star on the phone really help me thanks.

Sera Woolley

I made the right choice and now I feel…

I made the right choice and now I feel relieved that I did.


Really genuine kind and compassionate…

Really genuine kind and compassionate team with great knowledge and friendly approach highly recommend them!

Katelia Merritt

I must say Jake took me through every…

I must say Jake took me through every step and was brilliant, recommend them anytime.

Allan Green

Very happy and everything explained…

Very happy and everything explained well, so glad a took the time to take the call, normally I would say I'm busy. But compared to other company's we save so much more money.

Jenny Berry
We’re rated as 'Excellent' with 78,528 customer reviews