Life insurance helps you protect your loved ones financially, and buying the right policy can make all the difference in peace of mind and security in the event that something happens to you. But what is life insurance, exactly? And how much does it cost? These questions, and more, are answered in this helpful guide to life insurance in the UK.

What is life insurance

Life insurance provides a financial payout upon death. In exchange for your monthly or annual payments, a life insurance company will make sure that your spouse, children or other family members are taken care of should you die. Depending on what type of plan you purchase (term or permanent), how much coverage you want and how long you pay into your policy, life insurance premiums can cost as little as $30 per month. But why isn’t everyone covered? According to some estimates, as many as 25 percent of U.S. adults don’t have life insurance. Read on for more about why Americans might not be getting their financial bases covered and ways to get started if you need a policy yourself today!

What happens if you don’t have it

First, it’s important to know that life insurance is not a one-size-fits all kind of product. There are a number of different types, each with their own pros and cons. Term life insurance, for example, is simple — you pay into an insurance policy for a set term (which can be anywhere from 10 years up to 35), your policy pays out if you die within that time frame and that’s pretty much it. Life insurance, however, covers you until you pass away at any age (called universal life). In both cases, part of what’s critical is your health; it will determine how much you end up paying in premiums as well as whether or not an insurer will approve your application at all.

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The importance of having a plan in place

Life insurance is one of those financial instruments that is vitally important but can seem far-removed from your everyday life. It’s probably not something that comes immediately to mind when you think about how a financial plan can help support you and your loved ones, which is why it’s all too common for people to put off buying life insurance or simply ignore it altogether. But there are many reasons why life insurance is an essential part of any responsible person’s financial plan, especially if you’re considering starting a family, paying down debt or simply setting aside money for retirement. First off, let’s quickly go over some basics on what life insurance actually is.

Typical costs – what are the average costs?

In 2017, life insurance costs on average £19.70 a month (or £239 a year). If you’re applying for a policy as an individual, it’s unlikely that your life insurance will cost anything near these figures. Men pay more than women because statistically speaking they are more likely to die first. So you can expect to pay more if you’re male—and less if you’re female. In general though, life insurance costs around £20 a month for basic cover for an individual aged 25 – 35 with no dependants or existing health conditions – with children costing slightly more. Life insurance is actually pretty cheap when you consider its purpose – providing cover for your family in case something happens to you.

How can you save money?

If you’re looking for a way to save money on your life insurance policy, one of your best options is to get married—unless you’ve already got a spouse. Life insurance policies can be costly (just take a look at what some companies charge), but there are ways you can save money. One of those options is by applying for an individual policy as opposed to getting a joint life policy with your partner. An individual life policy will typically cost less than a joint policy; however, keep in mind that if you pass away, any beneficiary that would receive payments from your joint policy wouldn’t be entitled to any money from an individual one. If you’re only looking for a smaller policy, there are ways you can save even more. One of these options is by opting for an annual renewable term insurance policy—these policies have low-cost premiums but only last for one year, at which point you’d need to pay for another policy. As long as your financial situation doesn’t change significantly during that year, an annual renewable term life insurance plan might be a good way for you to save money on your premiums. Another option is buying your life insurance in bulk when it’s off-peak—usually December through February—and then not buying another one until it gets closer to Christmas time.

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