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Term life insurance, for the years that count

Term life insurance protects your family for a fixed period, such as five, ten or 25 years, paying out if you pass away within it (MoneyHelper ↗).

It is a simple way to protect a family or a mortgage for the years they need it.

This guide explains the three kinds of term cover, what drives the price and when a policy pays.

Every claim here is our summary of a named external source, linked beside it. Sources change: check the wording at the link before you rely on it.

How it works ↓What affects the cost →
01 · The basics

What is term life insurance?

Term life insurance runs for a fixed period, known as the term.

It pays out if the person insured passes away during the term, and MoneyHelper says many good policies have a terminal illness benefit, so you can claim early if you are diagnosed with an illness where your life expectancy is less than 12 months (MoneyHelper ↗).

The payout can be a lump sum or regular payments (MoneyHelper ↗).

You are covered only for the term.

Legal & General, for its own policy, says cover stops when the policy ends and the plan has no cash value unless a valid claim is made (Legal & General ↗).

There are three kinds of term cover.

Switch between them to see how each one moves.

How the cover moves over the term
Start of termEnd of term

Level: the same amount throughout

Pays a lump sum if you pass away within the agreed term, and the cover stays the same throughout. MoneyHelper calls it the most simple and affordable option (MoneyHelper ↗).

The bars show the shape of the cover only. They are not to scale and carry no insurer's figures.

02 · From application to payout

How term life insurance works

You choose the amount of cover, or how much you can afford each month, and how long you need it for (Legal & General ↗).

You also choose whether the policy covers one person or two (Legal & General ↗).

Be honest about your medical history.

MoneyHelper says most claims are successful, but insurers check your medical history when you claim and might not pay if you did not disclose something (MoneyHelper ↗).

The ABI reported that 97.9% of new individual protection claims were paid in 2024 (ABI ↗).

Keep paying.

For its own plan, Legal & General says that if you stop paying premiums when due, the plan is cancelled and you get nothing back (Legal & General ↗).

MoneyHelper says you have 30 days from buying a policy to change your mind and get a full refund (MoneyHelper ↗).

01

Apply

Choose the cover and the term

The amount, or the monthly cost you can afford, and how long you need it for. Answer the health questions fully.

02

Pay

Pay the premium each month

The policy covers you for the term as long as the premiums are paid.

03

Claim

Your beneficiaries claim

If the person insured passes away within the term, or a terminal illness benefit applies, the insurer pays on a valid claim.

04

End

Or the term ends

When the term ends, the cover stops and nothing is paid.

03 · Other types

Term life insurance vs other types

The other main type is whole of life cover, which pays out whenever you pass away, as long as you keep up the premiums (MoneyHelper ↗).

Over 50s plans are a form of whole of life cover sold without health questions.

The table sets out how MoneyHelper describes each.

Whole life insurance →Over 50s life insurance →

A fixed period

Term

For life

Whole of life

For life, no medical

Over 50s plan

Pays out
If you pass away within the term (MoneyHelper ↗)
At any point in your life, if premiums are kept up (MoneyHelper ↗)
A fixed sum, whenever a claim arises (MoneyHelper ↗)
Health questions
Yes: price and eligibility depend on you (MoneyHelper ↗)
Yes
None: guaranteed acceptance (MoneyHelper ↗)
Premiums
Depend on age, health, smoking and term (MoneyHelper ↗)
Can be reviewed every five or ten years and rise (MoneyHelper ↗)
Fixed; never change (MoneyHelper ↗)
Often used for
Dependants and a mortgage (MoneyHelper ↗)
Inheritance Tax planning (MoneyHelper ↗)
A contribution to funeral costs (MoneyHelper ↗)
Watch for
No payout once the term ends
You could pay in more than it pays out (MoneyHelper ↗)
You might pay in more than your family gets back (MoneyHelper ↗)
Swipe to compare
04 · The price

Cost of term life insurance in the UK

MoneyHelper says a policy giving your loved ones a decent amount of protection can cost from just a few pence a day, and that your premium depends on your age, health, lifestyle, whether you smoke, your family medical history, the length of the policy and your occupation (MoneyHelper ↗).

We publish no prices of our own.

Premiums vary, so MoneyHelper suggests shopping around and comparing quotes (MoneyHelper ↗).

Affordable family life insurance →Life insurance for smokers →
Age cover starts

£25 a month, 25 years

Cash sum

Age 20
£1,083,422
Age 30
£563,838
Age 40
£214,688
Age 50
£75,521
Age 60
£23,258
Age 70 (19 year term)
£8,645

Legal & General's published examples for its level life insurance: customers who don't smoke and have good overall health, paying £25 a month for a 25 year policy, quotes taken from its site on 13 March 2026 (Legal & General ↗). Its figures, not ours, and not a quote for you. Decreasing cover could be cheaper.

05 · Who it suits

Is term life insurance right for you?

MoneyHelper sets out when life insurance may suit you, and when you might choose not to get it; the card lists both (MoneyHelper ↗).

It pays out if you pass away, not if you are off work through illness (MoneyHelper ↗).

For that, look at income protection or critical illness cover (MoneyHelper ↗).

Life insurance for a mortgage →Critical illness cover →

MoneyHelper: it may suit you if

  • You have dependants, such as school-age children
  • A partner relies on your income
  • You want your loved ones to be able to cover your funeral

You might choose not to get it if

  • You are single
  • Your partner earns enough for the family to live on
  • You are on a low income and could qualify for State benefits

Summarised from MoneyHelper's guide (MoneyHelper ↗). General information, not a recommendation.

06 · For business owners

Run a business? There is a business version

Business life cover follows the same term logic.

HMRC allows a company to deduct key person premiums only where, for life cover, the policy is term insurance with no other benefits (HMRC ↗), and it treats whole life premiums as capital that is not deductible (HMRC ↗).

This site is mainly about cover a company buys, and the cards show who each policy pays.

Key person vs relevant life →
07 · Sources

Check it for yourself

Every claim on this page is our summary of one of the documents listed here.

We last checked them against the live sources on 28 September 2026.

The documents are the authority, not this page.

Insurers and HMRC update them, so validate any figure or condition at its link before you rely on it.

Questions

Term life insurance, answered

Term life insurance runs for a fixed period, the term, such as five, ten or 25 years, and pays out if you pass away within it.

MoneyHelper says many good policies also have a terminal illness benefit, which lets you claim early if you are diagnosed with an illness where your life expectancy is less than 12 months. MoneyHelper ↗

It depends on you.

MoneyHelper lists your age, health, lifestyle, whether you smoke, your family medical history, the length of the policy, your occupation and the level of cover.

As one insurer’s published example, Legal & General says £25 a month on a 25 year policy bought a 30 year old non-smoker in good health £563,838 of cover, from quotes taken on 13 March 2026.

That is its figure, not a quote for you. Legal & General ↗

With level cover the amount stays the same throughout the term.

With decreasing cover it reduces each year; MoneyHelper says it is designed to be used with repayment mortgages, where the outstanding loan decreases over time. MoneyHelper ↗

Check what your employer provides first.

Legal & General says most UK employers offering death in service pay two to four times salary.

MoneyHelper points out that if you stop working for that employer, you are no longer covered by their policy. MoneyHelper ↗

Often, yes.

MoneyHelper says lots of health conditions are accepted by regular life insurance, and that it may be cheaper than a guaranteed-acceptance plan even with an existing condition.

Answer every health question fully: an insurer checks your medical history at claim time and may not pay if something was not disclosed. MoneyHelper ↗

Long enough to cover what you are protecting: for example the years left on a repayment mortgage, or the years your children will depend on your income.

Insurers let you choose the length when you apply, and the cover stops when the term ends.

Beta · information only

Personal cover sorted? See the business side.

If you run a company, the business protection guide sets out what each business policy does and who it pays, from HMRC's manuals and the insurers' own guides.

01Key person, relevant life and shareholder cover

02Who each policy pays, with sources

03No email, no quote, no sales call

Information, not advice

We are not an insurer, broker or regulated adviser, and we do not give quotes or recommend a policy. For regulated advice, use an adviser authorised by the FCA.

Open the business guide →

Takes you to the business protection insurance guide.

Not financial advice. This page is general information. Before buying insurance, the FCA tells consumers to check the firm on its Firm Checker (FCA ↗). For free guidance, see MoneyHelper.