Level term life insurance

  • Cover for a specified period (the term)
  • Provide loved ones with a fixed lump sum pay out
  • Pay out (sum assured) up to £1,000,000
  • Term length up to 40 years
  • Affordable premiums from 20p-a-day
Level term life insurance summary

Level term life insurance is a form of life insurance that provides your loved ones with a fixed lump sum pay out if you pass away during the policy term.

Unlike decreasing term life insurance, the pay out sum maintains its value throughout the policy term.

So, regardless of how far into the policy you pass away, your loved ones will always receive the same amount.

For this reason, level term life insurance is ideal for helping to protect large expenses for your loved ones.

If you don’t pass away during the set term, cover will expire and no pay out will be made to your loved ones.

Watch our short video on level term life insurance:


Our award-winning and fee-free service can help you compare level term quotes from top UK insurers.

Quotes start from just 20p-a-day.

What is a level term life insurance policy?

A level term life insurance policy offers cover for a set period (the term) and provides a fixed pay out if your pass away during the term.

How does level term life insurance work?

Fee Free

Apply for a policy, you can do this via the phone or using our online service. You’ll need to provide details about yourself and the policy of your choice to determine the price you’ll pay.

Policy Term

Once in place, your policy will last for a set period (usually up to 40 years depending on you circumstances) and if you pass away during this time a fixed lump sum payment will be made.

Payment Period

You’ll be required to make monthly payments (known as life insurance premiums) in order to keep your cover in place.

Paperwork Application

If you pass away during the term, your loved ones can make a claim on your policy. This often involves filling in a claims form and providing the insurer with a death certificate.

Inhertiance

Once a successful claim has been received, your loved ones will receive a lump sum payment. This can help them cover essential financial commitments and other key costs.

It’s important to be aware that if you outlive the policy term, no pay out will be issued and your loved ones won’t be able to make a claim on your passing after the policy has expired.

A friendly member of our team can provide you with all the information you need to know about level term life insurance to help you make a fully informed decision.

We can also help you compare multiple quotes, free of charge. Simply get in touch.

If you require further reading, why not read our comprehensive ‘how does life insurance work UK’ guide? »

How much level term life insurance do I need?

When determining how much level term life insurance you need, you’ll need to consider how much your loved ones would need to help cover essential costs when you’re no longer around.

  • Cover mortgage or rental payments
  • Fund day to day family living costs
  • Cover outstanding debts in your name
  • Cover the cost of your funeral
  • Provide an inheritance

By adding together your key expenses, you can estimate how much you’ll need for your sum assured.

For example:

Family living costs + Remaining mortgage balance + Funeral costs = Sum assured


Why not use our handy calculator tool (below) to help you understand how much life insurance you need to protect your family?

Level term life insurance calculator

Enter your financial commitments and key costs below to calculate how much level term life insurance you might need.

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£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.

Source: Moneynerd.co.uk

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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.

Source: Nimblefins.co.uk

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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.

Source: Money.co.uk

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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.

Source: SunLife.co.uk

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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: Daynurseries.co.uk, Primarytimes.co.uk & Savethestudent.org

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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.

Source: Moneyage.co.uk

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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.

Source: Scottishbusinessnews.net

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Your total cover estimate

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What is the best level term life insurance?

The cover offered can vary between insurers, making it important to compare multiple quotes to ensure you’re getting the right cover for your needs.

The best level term life insurance to meet your needs will be the policy that offers the level of cover over the right term length.

Below we have compared the level term life insurance options available through Reassured:

InsurerAge restrictionsPolicy term (years)Pay out rateAdditional benefitsStar rating out of 5 stars (Defaqto)
AIG logo 18 - 852 - 70

99.0%

Terminal illness cover, waiver of premiums, life change benefit, joint cover Defaqto 4 stars
Aviva 18 - 771 - 50

99.4%

Terminal illness cover, Aviva DigiCare+, joint cover, house purchase cover, life change benefit Defaqto 5 stars
Legal & General 18 - 771 - 50

96.7%

Terminal illness cover, joint cover, life change benefit, waiver of premiums Defaqto 5 stars
LV= 18 - 84

5 - 50

97.0%

Terminal illness cover, joint cover, LV= doctors services, life change benefit, member benefits Defaqto 5 stars

How much is level term life insurance?

Level term life insurance can be as cheap as £5 per month through Reassured.

However, the exact price you pay for level term life insurance will depend on your personal circumstances.

When applying for cover, insurers will take key information into consideration when calculating your monthly life insurance premium.

The information required during the application process includes:

As the sum assured remains fixed throughout the policy term, premiums tend to be more expensive than decreasing term life insurance (where your risk to the insurer reduces).

However, level term life insurance is still one of the most affordable forms of cover.


Level term life insurance rates

The quotes below are based on a non-smoker, in good health, for a level term life insurance policy (20 year term) with £100,000 of cover:

Age Aviva AIG logo Legal & General
20£3.50£3.64£4.99
25£3.50£4.46£4.99
30£4.23£5.08£4.99
35£5.67£6.47£6.32
40£7.97£8.52£8.77
45£11.43£12.19£13.28
50£18.34£18.17£21.13


Not only can prices vary depending on your personal circumstances but also between providers.

At Reassured we’re committed to finding you our best deals from our panel of insurers.

Put our award-winning team to work and get in touch today.

Can I buy level term life insurance online?

Yes, you can now buy level term life insurance online through Reassured.

Buying life insurance online allows you to browse multiple quotes at your own leisure and you can go through the application as slow or as quickly as you’d like.

If you know that level term life insurance is right for you and you know how much cover you require, securing a policy online could be an ideal choice.

The benefits of buying life insurance online include:

  • Secure a policy at a time that suits you
  • Have access to multiple level term life insurance quotes at your fingertips
  • Loved ones can be covered in a matter of minutes
  • We’re just a phone call away if you need help or have any questions

For more information, why not check out our dedicated buy life insurance online page »

Can I get level term life insurance with critical illness cover?

Yes, it’s possible to add critical illness cover to a level term life insurance policy for an additional cost.

When added to a life insurance policy, critical illness cover can allow you to make a claim if you’re diagnosed with a serious (but not life-threatening) illness or your loved ones can claim if you pass away.

If you’re unable to work as a result of your condition, the funds from critical illness cover could help to replace lost income and/or cover private medical treatment.

Typically, there’s a list of 30 illnesses covered within critical illness cover, including heart attack, stroke and some forms of cancer.

However, this can be more or less comprehensive depending on the insurer.

Compare level term life insurance with critical illness cover through Reassured. Quotes start from £10 a month º .

Can I get joint level term life insurance?

Yes, level term life insurance can be purchased as a joint policy.

With a joint level term life insurance policy, two lives will be covered under one policy.

This means there’s only one application form to fill in and one premium to pay between you both. However, there will also only be one fixed lump sum payment (usually paid upon the first death) if one person passes away during the policy term.

Once this pay out has been issued the policy will expire and the surviving policyholder will need to secure new cover.

While it can be more expensive, securing two separate level term life insurance policies can provide two separate pay outs (providing a more comprehensive solution).

The table below shows a price comparison between joint life insurance vs two single policies.

Quotes are based on a 20 year level term life insurance policy for non-smokers, in good health, for £100,000 of cover:

AgeOne joint level term policyTwo single level term policies
20£5.45£7.10
25£6.00£8.62
30£6.69£8.68
35£8.14£15.54
40£10.40£15.94
45£13.35£22.86
50£17.82£33.78


Compare joint and single level term life insurance policies through Reassured to find the right option to meet your needs.

Level term life insurance advantages and disadvantages

When securing cover, it’s important to weigh up the pros and cons of your options to ensure you’re taking out the right cover for your needs.

AdvantagesDisadvantages
An affordable form of cover (starting from 20p-a-day through Reassured)More expensive than decreasing term life insurance
Pay out sum doesn’t change over timePay out isn’t guaranteed
Large pay out potential (up to £1,000,000)Possible to outlive the policy
Terminal illness cover included at no extra costYou’ll need to disclose medical information during the application (which could increase premiums if you have a medical condition)
Cover can be tailored to meet your needs with your choice of term length (for example, when your mortgage comes to an end)
Can be taken out as a single or joint policy


Level term life insurance is likely to be most beneficial for those with families to help protect their living costs and/or the family home.

When securing term life insurance at a young age, you can benefit from cheap premiums throughout the lifetime of your policy.

As personal details (such as your age and medical history) are required during the application, if you’re at an older age and/or have a pre-existing medical condition you may experience inflated premiums.

Why not speak to a friendly member of our team who can provide you with all the information you need to know about level term life insurance?

Can I write level term life insurance in trust?

Yes, level term life insurance can be written in trust.

Writing your life insurance in trust is a process that can detach the value of your policy from your estate.

The funds from your life insurance policy will be managed by a trustee (of your choosing) after your passing who will ensure they are distributed as per your wishes.

The process of writing your level term life insurance policy in trust has several important benefits:

  • Avoid or minimise 40% inheritance tax (so loved ones receive a full pay out)
  • Avoid a lengthy probate process (so loved ones receive a faster pay out)
  • Have more control over the pay out (who gets what and when)

Reassured offer a free trust writing service (if required and offered by the insurer), where we can walk you through the process and answer any questions you may have.

Compare level term life insurance quotes (find our best deals)

Comparing multiple level term life insurance quotes can help you find a great deal on a policy that meets all your requirements.

At Reassured we can help you compare quotes from some of the UK’s best life insurance providers, as well as smaller specialists.

Our dedicated team are also on hand to guide you through the application process, decode any jargon and answer any questions you might have along the way.

We also offer a buy online service if you know that level term life insurance is right for you.

All quotes are personalised, fee-free and without obligation.

Take the first steps in protecting your loved ones and get in touch today.

Level term life insurance FAQs

What is 20 year level term life insurance?

20 year level term life insurance is a level term policy that provides cover for 20 years.

When securing term life insurance, you have the freedom to choose a policy term that best meets your needs (usually up to a maximum term of 40 or 50 years).

If you have 20 years remaining on your mortgage or have young children that you’d like to protect until they reach adulthood, then a 20 year term could be well suited.

However, if it best meets your needs, it’s possible to have a longer (or shorter) term.

Can level term life insurance cover a mortgage?

Yes, a level term life insurance can be used to help protect a mortgage.

Mortgage life insurance is simply a life insurance policy which is secured to protect your mortgage. Often this is a decreasing term life insurance policy but could also refer to a level term life insurance policy.

A level term life insurance policy can be ideal for helping to protect an interest-only mortgage due to the fixed sum assured.

Alternatively, if you have a repayment mortgage, a level term policy could be used to help cover your mortgage balance and provide an additional sum to help cover bills and family living costs.

Speak to an expert member of our team about our best way to protect your mortgage.

What happens if I outlive my level term life insurance policy?

If you outlive your policy term, cover will expire and no pay out will be issued.

Level term life insurance provides cover for a specified period. While this could be for a substantial period, it’s possible to outlive the term.

If you pass away after your policy has expired, your loved ones won’t be able to make a claim.

Can I get level term life insurance with no medical?

Yes, it’s possible to secure level term life insurance without having to undergo a medical exam.

It’s uncommon for insurers to request a medical exam. However, you’ll be required to answer medical questions during the application.

A medical exam is typically only requested so insurers can get a better understanding of your health (for example, if you have a pre-existing medical condition).

Even in this circumstance, it’s more common for insurers to obtain a medical report from your GP (this can only be done with your consent).

If a medical exam is requested, it will be arranged and paid by the insurer.

Read our full no medical life insurance page for more information.

Is level term life insurance an option for seniors?

Yes, level term life insurance could still be an affordable option for those in their senior years. However, this will depend on your personal circumstances.

Many seniors opt for an over 50s plan where acceptance is guaranteed to those aged 50 - 85 (with no medical information or exam required) and a pay out is guaranteed.

However, the sum assured is typically much lower than with standard cover and premiums can be inflated due to the unknown risk to the insurer.

Therefore, if you’re still in good health, a level term life insurance policy could allow you to secure a cheaper premium and larger cover amount.

We can help you find suitable senior life insurance to meet your needs. Simply get in touch to discuss your options.

Sources:

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

[2] https://www.nimblefins.co.uk/average-uk-household-budget

[3] https://themoneycharity.org.uk/money-statistics/

[4] https://www.sunlife.co.uk/funeral-costs/

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