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Life insurance provides peace of mind that your loved ones are financially secure when you’re gone. This guide helps you compare options like term and whole life, plus features such as critical illness cover.
Choosing the right life insurance isn’t one-size-fits-all. It depends on your life stage, family situation and financial needs.
Think about how much cover you need and for how long. If you have a 20-year mortgage, a decreasing term policy may suit you best. Or, if you’re getting older and wish to leave a gift for your children or grandchildren, a ‘whole of life’ policy may be more appropriate.
Your finances also play a big role. Consider how much you can comfortably pay each month, as this will affect the payout size. If your employer offers death in service benefits, that can add to your cover while you’re there but it’s important to check if it’s sufficient.
Here, we outline the main types of life insurance and what each offers, helping you make an informed choice that suits your future plans. Remember, payouts might be subject to inheritance tax.
There are two main types of life insurance:
Explore these and other life cover considerations here. And compare Post Office life cover types to find the best fit for your needs.
Post Office offers three types of term life insurance. Discover the right cover for you:
What is it for?
It pays out a cash lump sum to use as you or your loved ones see fit. This might be to pay bills or a mortgage if you have one.
Why might you need it?
Choose level cover for a policy that pays a fixed amount upon your death, helping your loved ones with debts and maintaining their lifestyle.
How does it work?
What is it for?
It’s mainly used to pay off a mortgage if you die.
Why might you need it?
Decreasing cover protects your family from debts like a mortgage or loans. Choosing it protects your family from the responsibility of that debt and finding the income to cover it. It means they can continue to have a home without pressure or having to sell or downsize.
How does it work?
The payout decreases over time, so make sure it covers your mortgage. If your mortgage rate exceeds 8%, check it’s enough. Decreasing cover includes a mortgage guarantee, paying off the full mortgage balance if the payout is less than owed. Check the policy terms for details.
What is it for?
It helps provide for your loved ones and protects the money you leave behind from losing value due to inflation.
Why might you need it?
As prices rise, increasing cover make sure the cash amount paid out if you die increases each year, helping your family manage living costs.
How does it work?
You can skip the annual increase if you prefer, meaning neither the cash payout nor the monthly premium will rise. If you skip this for three consecutive years your policy will switch to level cover and no further automatic increases will apply.
One way to understand the difference in what these types of term life cover would pay out is to see it. So here's an example showing how a payout amount worth £100,000 today would change over time.
Whole of life insurance covers you for your entire life. You pay into the policy and when you pass away, the insurer pays your loved ones, giving you peace of mind without needing to renew. This type of life insurance cover is called "life assurance," it's usually more expensive than term life insurance for the same payout as you don't define how long you want the cover for.
Cheaper whole of life options may cover shorter periods with smaller payouts. Like Post Office Over 50s Life Cover, which provides up to £10,000 of cover. Acceptance is guaranteed for UK residents aged 50-80.
Select a type of life insurance to find out more about how it works and how it can help.
Joint life insurance
Joint life insurance protects you and your partner. It pays out if one of you dies, ensuring your family is taken care of. But remember, after a claim the surviving partner won’t be covered anymore and will need their own policy.
Post Office offers joint policies with one premium payment. These only pay out once.
Two single policies protect each policyholder separately but will mean paying two premiums each month.
Critical illness cover (at extra cost)
Critical illness cover pays a lump sum if you become seriously ill. This can help with expenses like medical bills or home modifications.
The payout can be a percentage or a set amount, depending on the insurer. If you make a claim for critical illness, that part of the cover will end but the main policy will continue.
You usually need to buy this cover when you take out a life insurance policy, so check what illnesses are included and for how long.
Terminal illness cover
Terminal illness cover pays a lump sum if you’re diagnosed with an illness that will likely lead to death within a year. This cover can ease financial worries during a difficult time for you and your loved ones.
Terminal illness cover explained
Children's cover (at extra cost)
Children’s cover pays out if an insured child becomes seriously ill, usually as a lump sum. This can help with expenses like taking time off work to care for them.
The payout can be a percentage or a set amount. If you make a children’s cover claim, that part of the cover will end but the main policy will continue.
This cover must be bought at the same time as the life insurance policy. Make sure you know what’s covered and for how long.
We've compared our three Life Insurance cover types so you can easily see which may suit you.
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Key cover features |
Level cover What's it for? Providing for your loved ones and/or paying off an interest-only mortgage if you die during the policy term Fixed cash sum Yes What's the maximum Up to £750,000 (depending on your age) Age limits Ages 18-70 Is Terminal Illness Cover included? Yes Are health-related question asked? Yes Can I add Critical Illness Cover to my policy? Yes Can I add Children's Cover to my policy? Yes Can I apply for joint cover? Yes More information |
Decreasing cover What's it for? Typically used to pay off a repayment mortgage if you die during the policy term Fixed cash sum No, the payout amount reduces over time to keep track with your debt What's the maximum Up to £750,000 (depending on your age) Age limits Ages 18-70 Is Terminal Illness Cover included? Yes Are health-related question asked? Yes Can I add Critical Illness Cover to my policy? Yes Can I add Children's Cover to my policy? Yes Can I apply for joint cover? Yes More information |
Increasing cover What's it for? Providing for your loved ones and reducing the impact of inflation on the money you leave if you die during the policy term Fixed cash sum No, the payout amount grows each year to keep track with inflation What's the maximum Up to £750,000 (depending on your age) Age limits Ages 18-70 Is Terminal Illness Cover included? Yes Are health-related question asked? Yes Can I add Critical Illness Cover to my policy? Yes Can I add Children's Cover to my policy? Yes Can I apply for joint cover? Yes More information |
Over 50s life cover What's it for? Leaving a cash sum to help pay for your funeral, settle loans or as a gift Fixed cash sum Yes, or can also opt for increasing cover option What's the maximum Up to £10,000 (depending on your age) Age limits Ages 50-80 Is Terminal Illness Cover included? No Are health-related question asked? No Can I add Critical Illness Cover to my policy? No Can I add Children's Cover to my policy? No Can I apply for joint cover? Yes (excluding in-branch) More information |
|---|---|---|---|---|
|
What's it for? |
What's it for? Providing for your loved ones and/or paying off an interest-only mortgage if you die during the policy term |
What's it for? Typically used to pay off a repayment mortgage if you die during the policy term |
What's it for? Providing for your loved ones and reducing the impact of inflation on the money you leave if you die during the policy term |
What's it for? Leaving a cash sum to help pay for your funeral, settle loans or as a gift |
|
Fixed cash sum |
Fixed cash sum Yes |
Fixed cash sum No, the payout amount reduces over time to keep track with your debt |
Fixed cash sum No, the payout amount grows each year to keep track with inflation |
Fixed cash sum Yes, or can also opt for increasing cover option |
|
What's the maximum |
What's the maximum Up to £750,000 (depending on your age) |
What's the maximum Up to £750,000 (depending on your age) |
What's the maximum Up to £750,000 (depending on your age) |
What's the maximum Up to £10,000 (depending on your age) |
|
Age limits |
Age limits Ages 18-70 |
Age limits Ages 18-70 |
Age limits Ages 18-70 |
Age limits Ages 50-80 |
|
Is Terminal Illness Cover included? |
Is Terminal Illness Cover included? Yes |
Is Terminal Illness Cover included? Yes |
Is Terminal Illness Cover included? Yes |
Is Terminal Illness Cover included? No |
|
Are health-related question asked? |
Are health-related question asked? Yes |
Are health-related question asked? Yes |
Are health-related question asked? Yes |
Are health-related question asked? No |
|
Can I add Critical Illness Cover to my policy? |
Can I add Critical Illness Cover to my policy? Yes |
Can I add Critical Illness Cover to my policy? Yes |
Can I add Critical Illness Cover to my policy? Yes |
Can I add Critical Illness Cover to my policy? No |
|
Can I add Children's Cover to my policy? |
Can I add Children's Cover to my policy? Yes |
Can I add Children's Cover to my policy? Yes |
Can I add Children's Cover to my policy? Yes |
Can I add Children's Cover to my policy? No |
|
Can I apply for joint cover? |
Can I apply for joint cover? Yes |
Can I apply for joint cover? Yes |
Can I apply for joint cover? Yes |
Can I apply for joint cover? Yes (excluding in-branch) |
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More information |
More information |
More information |
More information |
More information |
It’s quick and easy to get a quote for Post Office Life Insurance online.
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Post Office Life Insurance offers up to £750,000 cover, depending on your age, for customers who are UK residents aged 18-70 at the start of the policy. The minimum term is 5 years and cover must end before your 90th birthday. If you miss payments, you will no longer be covered under the policy.
Post Office Life Insurance is underwritten and administered by Scottish Friendly Assurance Society Limited. Neilson Financial Services Limited assist in the administration. If you buy Post Office Life Insurance over the telephone or online via the Post Office website, it is arranged and sold by Neilson Financial Services Limited, following an introduction by Post Office Limited. If you buy Post Office Life Insurance online via a price comparison website, it is arranged and sold by the firm that provides the price comparison website services.
Depending on how long you live, you could pay more in monthly payments than the cash sum we pay out when you die. The cash sum you choose is fixed and inflation (the rising cost of goods and services) will reduce its value over time.
Post Office Over 50s Life Cover is administered by Aviva Protection UK Limited. Neilson Financial Services Limited assist with the administration. If you buy Post Office Over 50s Life Cover in a Post Office branch, it is arranged and sold by Post Office Limited and Post Office Management Services Limited. If you buy Post Office Over 50s Life Cover over the telephone or online via the Post Office website, it is arranged and sold by Neilson Financial Services Limited, following an introduction by Post Office Limited. If you buy Post Office Over 50s Life Cover online via a price comparison website, it is arranged and sold by the firm that provides the price comparison website services.
Our life insurance products
Post Office Limited is an appointed representative of Post Office Management Services Limited which is authorised and regulated by the Financial Conduct Authority, FRN 630318. Registered in England and Wales. Registered numbers 2154540 and 08459718 respectively. Registered office: 100 Wood Street, London, EC2V 7ER.
*Call charges: Calls to 03 numbers will cost no more than calling a standard UK number starting with 01 or 02 from your fixed line or mobile and may be included in your call package. Calls may be monitored or recorded for training and compliance purposes.