Does a single person need life insurance?

Yes, a single person may need life insurance for all sorts of reasons.

Some common examples include:

  • You have children or other dependents who rely on you for financial support
  • You’ve bought a property with a friend or relative and want to protect your proportion of the mortgage
  • You had a joint policy with an ex-partner, or with a partner who’s passed away, and now need new single cover
  • You’re a young singleton who wants to lock-in cheap life insurance whilst you can

Life insurance can provide your loved ones with a financial safety net should you pass away unexpectedly.

Even if the situations above don’t apply to you, having a policy in place when you’re single has lots of benefits.

For example, you could leave a cash gift for your loved ones, or you could ensure that your funeral costs won’t be a burden after you’re gone.

In this guide, we answer the question ‘is life insurance worth it for a single person?’ and explain policy types you may consider when living the single life...

Life insurance for single person with dependents

Singles with dependent children

In the UK, there’re around 1.8 million single parents with dependent children and 21% of all children live in lone parent families[1].

If you’re a single mum or dad then life insurance can be essential for securing the financial future of your children.

In the event of your passing, a life insurance pay out could be used by your family to cover:

  • Mortgage or rent payments (average mortgage debt stands at £130,000[2])
  • Household bills (council tax, gas, electric, water, broadband etc)
  • Day-to-day living expenses (food, travel, clothing, leisure, healthcare etc)
  • Childcare costs (average cost of full-time childcare per week is £263.81[3])
  • Future education costs (tuition fees in the UK are approximately £27,750 over three years[4])
  • Funeral costs (average cost of a funeral is £4,056 and total cost of dying is £8,864 in the UK[5])
  • An inheritance (a cash gift for your children for when they reach financial independence)

In the UK, the average cost of raising a child to the age of 18 for a lone parent is £193,801[6].

Life insurance can give you peace of mind that should the unexpected happen to you, your children have the financial support they need.

Singles with other dependents

Life insurance can provide a financial safety net for anyone who depends on you financially. Whether that be your children, a sibling, a parent or even a friend.

In the event of your death, the pay out from your policy could replace your income and help to cover essential costs.

Life insurance can also be used to make life more comfortable for the people you leave behind.

For example, if you were to pass away whilst caring for an elderly parent, they could use the money to pay for a private carer or to get private medical treatment.

Being the sole earner for your household and/or financially supporting others may mean that your monthly budget is tight, but at Reassured, we can help you to find the best life insurance quotes free of charge.

Source: https://www.childbereavementuk.org/death-bereavement-statistics

Reasons to get life insurance for single person with no dependents

As a single person with no dependents, the need for life insurance isn’t as obvious. However, there are many reasons to consider getting a policy.

Reasons include:

List icon To help pay for your funeral

Regardless of your age or relationship status, having life insurance in place to cover the cost of your funeral could bring some comfort for you and your loved ones.

These days, even a simple funeral can cost thousands of pounds (average cost of a funeral is £4,056) which is a financial burden many of us wouldn’t want to leave behind.

If you’re a single person over 50, then you may consider an over 50s plan to cover your funeral costs (acceptance is guaranteed to people aged 50 - 85).


List icon To pay off your mortgage

Life insurance is commonly taken out to cover a mortgage. You could arrange policy which is designed to clear your mortgage in the event of your death. This will ensure that any outstanding debt isn’t passed on to whoever inherits your home.

Life insurance may be even more important if you’re one of the many people who’s bought a property with a friend or relative. Should you pass away unexpectedly, the pay out from the policy will help them to cover your half of the mortgage so they could remain in their home.

It’s sensible to compare multiple quotes for mortgage life insurance, even if you’ve been offered a policy through your mortgage lender (as usually they don’t provide the best rates).


List icon To leave an inheritance

You may not need to protect the financial future of a partner or children, but you may want to leave a cash gift to a special friend, relative or charity after you’re gone. The pay out from your life insurance policy can provide an inheritance to whoever you wish.

If you intend to leave some money behind to a beneficiary, then you may consider writing your policy in trust. This can help to avoid or minimise inheritance tax (IHT) which may apply to the pay out sum and ensures that the funds are distributed according to your wishes.

We discuss the benefits of writing your life insurance in trust in more detail below.


List icon To lock-in the lowest life insurance rates

Young and healthy singletons can secure the cheapest premiums available. If you’re in your teens, 20s or even 30s, you may not have huge financial responsibilities now, but is this likely to change?

As a young single person, you could take advantage of lower premiums today (whilst you can), on the assumption that you’ll buy a home, get married or have kids in the future.

If you do settle down at some point and find that your existing policy is no longer sufficient for your needs, then you could secure additional cover.

This can be done by taking out a new policy, or by increasing the pay out amount on your existing policy (only possible with some policies, this is known as the special events option or guaranteed insurability option).

We have an extensive article on life insurance for young adults if you’d like more information »

How much does life insurance cost for a single person?

Life insurance arranged through Reassured starts from just 20p-a-day.

Although the exact cost of your life insurance will depend on your personal circumstances and the policy you choose.

Your monthly life insurance premium will be calculated based on the following factors:

  • Age
  • Health
  • Medical history
  • Smoking status
  • Lifestyle
  • Occupation
  • Pay out amount (sum assured)
  • Type and length of cover (term)

The table below displays the monthly cost of premiums for term-based and whole of life insurance. Quotes based on a non-smoker in good health for £100,000 of cover protection:

AgeLevel term cover (20-year term)Decreasing term cover (20-year term)Whole of life insurance
20£3.61£4.36£61.03
25£4.73£4.92£64.86
30£4.82£4.99£71.01
35£6.00£5.09£82.93
40£7.87£6.05£100.90
45£11.07£8.10£124.34
50£16.18£10.99£150.50


The cost of life insurance varies from person to person as well as between different insurers.

For this reason, it’s sensible to compare multiple quotes from various insurers to make sure you’re getting the best deal.

You can do this quickly and easily by using a life insurance broker, such as Reassured (our quotes are free).

Types of life insurance for single people

There are different types of life insurance designed to suit different needs and budgets. Each of these can be arranged through Reassured:

Type of life insurance types for single people term life insurance

Term life insurance

Term life insurance is ideal for singles in their 20s, 30s and 40s who want to cover their mortgage, replace an income and/or leave an inheritance.


Policy key features:

  • Pays out a cash lump sum to loved ones if you pass away during the set term
  • Term length from 2 - 40 years
  • Pay out sum up to £1,000,000
  • Fixed monthly premiums
  • Available with a fixed sum assured (level term cover) or reducing sum assured (decreasing term cover)
  • Application includes medical questions
  • Can be written in trust to avoid or minimise inheritance tax (IHT)
  • Premiums from just 20p-a-day through Reassured
Type of life insurance types for single people over 50s life insurance

Over 50 life insurance (over 50s plan)

If you’re a single person aged between 50 - 85 and living with a medical problem, then you may consider over 50s life insurance.


Policy key features:

  • Guarantees acceptance to applicants aged 50 - 85
  • No health or medical questions
  • Guarantees a cash pay out when you pass away
  • Pay out sum up to £20,000
  • Fixed monthly premiums until you turn 90 (or until you pass away)
  • Typically used to help cover funeral costs, pay off outstanding debts and/or to provide an inheritance
  • Can be written in trust to avoid or minimise inheritance tax (IHT)
  • Premiums from just 20p-a-day + through Reassured
Type of life insurance types for single people whole of life insurance

Whole of life insurance

Whole of life insurance is best suited to singles in their 50s and 60s who are in relatively good health.


Policy key features:

  • Guarantees a cash pay out when you pass away
  • Pay out sum up to £1,000,000
  • Fixed monthly premiums until you pass away
  • Typically used to cover outstanding debts, funeral costs, living costs of dependents, and/or to provide an inheritance
  • Application includes medical questions
  • Depending on how long you live, there’s a chance you could pay more into the policy than what’s paid out
  • Can be written in trust to avoid or minimise inheritance tax (IHT)
  • Premiums from just 27p-a-day ± through Reassured
Type of life insurance types for single people family income benefit

Family income benefit (FIB)

You may consider family income benefit if you have children who rely on you for financial support.


Policy key features:

  • Pays out monthly tax-free payments (instead of a lump sum) if you pass away during a set term
  • Payments will start from the date of death and will stop when the term ends
  • Term length 2 - 40 years
  • Helps with long-term family budgeting of day-to-day living expenses such as mortgage or rent, bills, food, and childcare
  • Pays out up to £5,000 a month
  • Fixed monthly premiums
  • Application includes medical questions
  • Can be written in trust to ensure the pay out is granted to your children, plus avoid or minimise inheritance tax (IHT)
  • Contact Reassured for FIB quotes

Get in touch with Reassured to learn more about these policy options and get your free quotes. Let us help you find the best life insurance for singles.

Other types of insurance for single people

Whether you decide to take out life insurance or not, there are other types of policies you may also consider as a single person.

Critical illness cover (CIC)

Critical illness cover is a type of policy which provides you with a cash pay out if you’re diagnosed with a life changing (but not terminal) illness.

This type of cover is important for single people who don’t have any other source of income and would struggle financially if they became too ill to work.


Policy key features:

  • Offers protection for a set term
  • Covers a wide range of illnesses including heart attack, stroke, MS, and some cancers
  • Can get as a standalone policy (available with some insurers) or combine with some types of life insurance for an additional cost
  • If added to a life policy, it will only pay out once for critical illness or upon your death
  • Application includes medical questions
  • Premiums from just 33p-a-day º through Reassured

Income protection insurance (IP)

Income protection insurance is a type of policy which is designed to protect your income in the event you’re unable to work due to illness or injury.

Income protection is essential for many people, especially those who’re self-employed and can’t rely on sick pay from an employer.


Policy key features:

  • Pays out up to 70% of your normal income
  • Provides a regular monthly income to help you cover essential costs such as mortgage or rent payments and daily living expenses
  • Different types of cover to suit different needs and budgets
  • Available as a short-term policy (payment period up to two years) or as a long-term policy (payments last until retirement)
  • Application includes medical questions
  • Premiums from just 20p-a-daythrough Reassured Advice

For more information on either of these policies, contact Reassured without obligation.

Writing life insurance in trust (avoid/minimise 40% IHT tax)

Writing your life insurance in trust means placing someone you trust (a trustee) in charge of your policy.

When you pass away, the trustee will manage the pay out and ensure that it’s distributed according to your wishes.

Not many people are aware of the benefits of writing life insurance in trust. The main advantages include:

  • Avoid or minimise 40% inheritance tax
    Life insurance is subject to inheritance tax (40%) if the value of your estate exceeds the tax-free threshold of £325,000. If your policy is written in trust, then this could detach it from your estate – avoiding the tax bill and ensuring your loved ones receive a full pay out
  • Avoid the probate process (faster pay out)
    If your policy is written in trust and gets legally detached from your estate, then it doesn’t need to go through probate (the lengthy process of dealing with your estate after you’re gone). Your loved ones will receive the money within a few weeks, instead of after many months
  • More control over the pay out
    Putting your policy in trust will ensure that the pay out is received by your named beneficiaries (and not by anyone else). This is especially important if you’re unmarried and you intend for the money to go to your children or another relative. Having a trust also allows you to decide when and how the funds are distributed, of which the trustee will manage after you’re gone

Reassured provide a free trust writing service with most of the policies we arrange. When setting up your life insurance through us, don’t hesitate to ask a member of our team about this option.

How much life insurance does a single person need?

The amount of life insurance you need depends on your personal circumstances and what you’d like your policy to cover.

If you’re a single person with no dependents and you’d like to protect your mortgage, then you’d simply take out enough cover to match your remaining mortgage balance.

It can be a little more complicated if you’re a single person with children (or other dependents) due to the additional financial responsibilities you may have.

One way to calculate how much life insurance you need is to multiply your annual salary by the number of years it will be until your children are financially independent.

Subsequently, the pay out sum will help to replace your income in the meantime and ensure that they can continue their current lifestyle if you were no longer around.

Another way is to add up your current financial commitments, as well as future expenses such as funeral costs and education fees, to work out how much cover you need.

If you’re a singleton in your teens or 20s, and haven’t bought a home or started a family yet, then you may want to take these life changes into account when taking out cover.

How much life insurance do I need?

Use this handy calculator to find out how much life insurance you may need as a single person. Simply enter the costs you would like your policy to cover.

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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 help you find your best quotes

Life insurance for divorced singles

Lots of married couples take out joint life insurance to protect each other in the event that one partner passes away.

However, if the relationship comes to an end, then this type of cover will no longer suit the needs of both parties.

If you’re recently single after a divorce and have an existing joint policy with your ex-spouse, then there’s usually three options:

  1. You may be able to split the policy into two single policies - providing that your terms and conditions include a ‘separation benefit’ add on (not all insurers will offer this option)
  2. One partner takes over the policy as the sole policyholder (again, not all insurers will offer this option)
  3. The joint policy is cancelled, and you both take out two new single policies

In another circumstance, if you and your ex-spouse had a single life insurance policy each, then you may consider:

  • Changing the beneficiary on your policy if this is your ex-partner
  • Checking that the amount of cover you have will suit your change in circumstances

We have written a dedicated joint life insurance after divorce article if you require more information »

When does a single person not need life insurance?

As discussed, there are many reasons to get life insurance when you’re single - even if you don’t have dependents.

However, there are some situations where life insurance may not be right for you.

For example, you might not need life insurance as a single person because:

  • You don’t plan on getting married or having children in the future
  • You have children but they’re now financially independent (and it’s not necessary to leave an inheritance)
  • You’re estranged from your family and have no dependents
  • Your mortgage has been cleared and you have no outstanding debts
  • You’ve made financial provisions for your funeral already (such as with a funeral plan)
  • You have death in service benefit from an employer which is sufficient for your needs

Where can I get free life insurance quotes?

No matter your circumstances, Reassured is here to help you find the most suitable life insurance for a single person.

A member of our friendly team is on hand to listen to your unique requirements and source you the best available quotes.

As mentioned, our customer service is award-winning and we’re an FCA-regulated broker, ensuring that you’re in great hands throughout your journey.

Make the most of our FEE-FREE service to arrange affordable financial protection today.

Sources:

[1] https://www.gingerbread.org.uk/what-we-do/media-centre/single-parents-facts-figures/

[2] https://www.thisismoney.co.uk/money/mortgageshome/article-7494625/Mortgage-holders-coming-end-two-year-fix-payments-double.html

[3] https://www.daynurseries.co.uk/advice/childcare-costs-how-much-do-you-pay-in-the-uk

[4] https://www.savethestudent.org/student-finance/university-study-cost.html

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

[6] https://cpag.org.uk/sites/default/files/files/policypost/Cost_of_a_child_2021.pdf

[7] https://www.childbereavementuk.org/death-bereavement-statistics

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