Compare level term life insurance quotes

It depends on your circumstances and the type of financial commitments you want to cover. It could also depend on the type of mortgage you have. For example, decreasing term cover wouldn’t be suitable if you have an interest-only mortgage, as it wouldn’t cover the outstanding balance you need to pay back.

Yes, it’s possible to have multiple life insurance policies. For example, you could have a policy to cover your mortgage and another policy to protect your children financially while they’re growing up.  

See more on having more than one life insurance policy.

The main difference is the amount paid out. Level term life insurance provides a fixed pay-out if you die within the term of the policy. With decreasing term life insurance, the pay-out decreases in value over the term of the policy.

For example, a level term policy taken out for 25 years for cover up to £100,000 will pay out that sum, whether the policyholder dies within three years or 20 years. A decreasing term policy decreases in value over the term of the policy. The longer the policy lasts, the less of that £100,000 amount will be paid out if you die.

If you die after the policy expires, there won’t be a pay-out. If you still want life insurance once the term has ended, you’ll need to take out a new policy.

If you take out level term cover, you might be able to add an option to renew. This allows you to renew your cover at the end of the term, instead of arranging a new policy. There’s no need to undergo a health check either.

You need to add this option when you take out a new policy, not after it’s become active.

If you outlive the term of your insurance, your loved ones won’t get a payment when you die. Some providers may allow you to extend the term of your policy, although it’s likely you’ll have to pay a higher premium.

But before you consider extending the policy, it’s worth considering whether you still need cover. It’s likely that your financial situation will have changed over the years. If your mortgage is paid off and your kids have grown up and left home, do you still need life insurance. If you do, do you need as big a pay-out?

Most life insurance providers offer this as an option. Critical illness cover offers financial protection by paying out if you’re diagnosed with an illness listed in your policy.

Some pre-existing conditions won’t affect your ability to get life insurance. But others, such as cancer and heart conditions, will raise a red flag with your insurance provider and could make it more difficult to find a policy. It’s also likely to make your insurance more expensive.

There’s a few ways you might be able to cut the cost of your premium: 

• Take out a policy when you’re younger and healthier – it’s likely to cost less than if you wait
• Check to see if you’re already insured. For example, you might have death in service insurance through your workplace.
• Get the right amount of cover - you don’t want to be underinsured, but nor do you want to find yourself paying for cover you don’t need
• Stop smoking, vaping and using any tobacco products – you’ll pay more for your premium if insurance providers consider you to be a smoker.

Typically, insurance providers will offer a grace period to allow you to catch up if you’ve missed a payment by accident. But if you don’t keep up your monthly payments the cover will end, and your policy won’t pay out if you die.

This will depend on how much the pay-out is and how much your estate is worth. You can consider the option of putting your life insurance policy ‘in trust’. This is a relatively simple legal procedure that means its value won’t be counted as part of your estate, so will be protected from inheritance tax. However, the money should still go to the people you want to receive it. 

See more on writing your life insurance in trust.

Right here at Compare the Market. The type of life insurance that’s right for you will depend on your own circumstances and needs. The cheapest quotes may not necessarily work for you.