If you're starting to think about getting life insurance, you don’t need to worry that you’re becoming old and boring. In fact, your 20s can be one of the most practical times to think about getting a life insurance policy in place. Premiums are generally lower when you're younger and in good health, and many young people need cover just as much as those later in life.
This guide covers who might benefit from life insurance as a young adult, how premiums work, and what Post Office has to offer.
It's easy to assume life insurance is something to sort out later, once you've bought a house and started a family. That's not always the case. There are plenty of reasons why people decide to get life insurance when under 30.
Dependants don't always mean children. Do you help support a parent financially? Do you have a sibling or partner who relies on your income, even partially? If you were no longer around, would the people in your life face a financial gap?
If the answer to any of those questions is yes, life insurance could be worth thinking about. A policy could help provide the people you care about with a financial safety net at what would already be an incredibly difficult time.
Signing a mortgage or taking on a joint loan is a big step. If your partner, friend or parent is a co-borrower, they could be left responsible for the full debt if you were to pass away.
Life insurance is one way of making sure that doesn't happen.
Premiums for life insurance are largely based on your age and health at the time you take out a policy. The younger and healthier you are, the lower your premiums are likely to be.
Taking out a policy in your 20s can therefore mean lower monthly costs for the duration of your term. You might recognise that bigger financial responsibilities are likely to be in your near future, and getting insurance in place early can save you money in the long run.
Not everyone takes out life insurance purely out of necessity. Some people simply want the peace of mind that, whatever happens, the people or causes they care about would receive some financial support. That might be a partner, a parent, or even a charity or community organisation that means a lot to them.
Life insurance premiums are calculated based on a number of factors, including your age, health, smoker status, occupation, lifestyle and the amount of cover you want. Age is one of the most significant, because the older you are, the higher the statistical likelihood of a claim.
This is why premiums are generally at their lowest when you're young and in good health.
The table below gives an illustration of how the monthly cost of £100,000 of cover can vary by age (we've included £120,000 for a 21-year-old as this is the minimum cover level for that age). These values represent non-smokers who practice healthy lifestyle choices and have no pre-existing medical conditions, based on a 21-year term with level cover.
|
Age |
Amount of cover and monthly cost 21 years old £120k from £5 31 years old £100k from £7.54 41 years old £100k from £15.51 51 years old £100k from £37.88 61 years old £100k from £93.09 |
|---|---|
|
21 years old |
21 years old £120k from £5 |
|
31 years old |
31 years old £100k from £7.54 |
|
41 years old |
41 years old £100k from £15.51 |
|
51 years old |
51 years old £100k from £37.88 |
|
61 years old |
61 years old £100k from £93.09 |
As the table shows, taking out a policy earlier in life tends to cost less per month than taking out the same level of cover later on. That said, age is only one part of the picture. Factors like smoking status, health history and the length of your policy term play a big role too.
Post Office offers term life insurance, which pays a lump sum to your loved ones if you pass away, or are diagnosed with a terminal illness, within the term of your policy. There are three ways the cover can be structured, depending on what you want it to do.
Your benefit amount stays the same for the full term of your policy. This can be a good fit if you want a fixed, predictable level of cover, perhaps to replace a set amount of income or leave a defined sum to your family.
Your benefit amount rises each year in line with inflation, tied to the Retail Price Index (RPI), up to a maximum annual increase of 10%. This is designed to help the value of your cover keep pace with rising prices over time. Please note, your monthly premiums will also increase each year if you opt for increasing cover.
Your benefit amount reduces over time. This option is specifically designed for people who primarily want their life insurance to cover something like a mortgage. Because the payout value decreases over time, monthly premiums are lower than the same policy with level or increasing cover.
If you want to build on your life insurance, Post Office also offers two optional extras:
These add-ons come at an additional cost and have their own terms, conditions and exclusions. It's worth reading the full policy details before deciding whether they're right for you.
Post Office Life Insurance is provided by Scottish Friendly. Here are some of the key features of our term life insurance:
2Service separate from the policy contract. It may be withdrawn at any time.
1Post Office Life Insurance is provided by Scottish Friendly. Scottish Friendly paid 99.1% of life insurance claims they received in 2024.
There's no single right answer, it depends on your circumstances. If you have people who depend on you financially, financial commitments that others would need to cover, or simply want to leave a financial gift behind to the people or causes you care about, life insurance may be worth considering. Getting a policy in place while you're young and healthy can also mean lower monthly premiums.
Post Office offers term life insurance with level, increasing or decreasing cover options. The right type will depend on what you want the cover to do. Decreasing cover may suit someone who primarily wants to protect a repayment mortgage, while level or increasing cover might be a better fit for those looking to support their family or leave a set amount behind.
None of these are a recommendation. It's worth thinking about your own situation or potentially speaking to a financial advisor before deciding.
Premiums vary based on your age, health, smoker status, occupation, lifestyle, the type of cover and the amount you choose. As a general rule, the younger and healthier you are, the lower your premiums are likely to be. You can get a personalised quote from Post Office online in a matter of minutes.
Yes. Post Office Life Insurance is available to UK residents aged 18 and over. Being in your late teens or early 20s could actually mean lower premiums, as insurers base their pricing partly on age and life expectancy.
Yes. When you apply for Post Office Life Insurance, you'll be asked questions about your health and lifestyle. It's important to answer these truthfully and accurately. If information turns out to be inaccurate when a claim is made, the claim could be rejected and the policy cancelled.
Yes. You can apply to make changes to your policy at any time. For example, you can update personal details, change your benefit amount, or add optional critical illness or children's cover. Some changes may be subject to additional health questions and could affect your premium.
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