What is life insurance?

How would your loved ones cope if you passed away suddenly? It’s hard to think about not being around to support the people important to you. But getting life insurance could give you peace of mind that your family will be looked after, at least financially.

Let’s look at the different features of life insurance cover. Whether you’re looking for single or joint life insurance, you might find a policy that matches all your needs.

  • Once you’ve purchased your life insurance policy, you can keep it active by paying your premiums regularly. If you pass away while your policy is still active, your loved ones can make a claim and receive a lump sum payout.

    The amount of money paid out to your loved ones will of course vary, depending on the type of cover you’ve purchased.

    Remember, life insurance policies have no cash in value at any time. This means that if you get to the end of the policy and no claim has been made, it will end, and you’ll get nothing back. If you don’t pay your premiums, then your policy will also end, and you’ll get nothing back.

  • There are different types of life insurance cover you can consider, depending on your situation:

    Level term life insurance

    Level term life cover means that the payout stays the same for the entire term. In this case, you’ll know the exact payout your loved ones will receive if they were to make a valid claim.

    Decreasing term life insurance

    With decreasing term cover, the payout goes down with time. This type of policy can be helpful if you want the payout to cover an important financial commitment, like a repayment mortgage. That’s because your mortgage’s balance will decrease with each repayment.

    Increasing cover

    Increasing cover considers economic factors such as inflation. This means that the potential payout goes up over time.

    Whole of life insurance

    This is usually the most expensive kind of policy because it covers you for the rest of your life. A lump sum may be payable to claimants in the event of your death, whenever that may be, rather than within a set period.

    Joint life insurance

    Joint life insurance is a type of cover suitable for couples or business partners whose finances are tied together. If one policy holder dies, then the other could make a claim for a payout to help with financial responsibilities left behind by their partner.

    Learn more about life insurance types.

  • Life insurance covers you in case you pass away. It provides a lump sum payment to your loved ones if they make a valid claim.

    This money could cover basic living costs like bills and food shopping. It might also go towards larger financial commitments such as mortgage repayments, or debts. Or it may be helpful in securing the financial future of your children, grandchildren, or other dependants.

    Even if they don't need it to cover day-to-day outgoings, life insurance can give stability to your loved ones when you can’t be there.

  • Whether you decide to take out life insurance can depend on your situation.

    • If you have several financial commitments, a life policy may protect your loved ones from the financial burden if you were to pass away unexpectedly.
    • If you have a partner or a family, they could benefit from a payout to cover their living costs in your absence.
    • Life insurance may also be suitable for parents or grandparents who want to make sure their children are provided for in the future, for example, helping to cover further education costs.
    • Joint life insurance may help cover shared financial goals – whether with a business or life partner. This could include mortgages and debts, so that one party isn’t left managing joint burdens alone.
  • How much you’ll pay for life insurance will depend on factors such as:

    • The kind of life cover you want. – For example, policies that last longer tend to pay out more, and may have higher premiums, compared to shorter-term cover.
    • Your age. – Premiums may increase with age, as the chances of your loved ones making a claim become higher the older you are.
    • Health. – If you are at risk of developing a certain medical condition, or already have one, this could affect how much you pay.
    • Lifestyle. – An insurer may charge you more if your regularly drink alcohol or smoke.
  • You may choose to add critical illness cover to your life insurance. If you’ve been diagnosed with an illness that the policy covers, this will give a further cushion for you and your family.

    You can purchase critical illness cover together with your Halifax life insurance policy, or separately if it suits you better.

  • To be eligible for life insurance, you must be:

    • resident in the UK

    • between the ages of 18 and 59.

    Our life insurance is provided by Scottish Widows - who are also part of Lloyds Banking Group. They are our life insurance experts, helping to protect what matters most for over 200 years.

    Ready to make that step?


    Get a life insurance quote


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Frequently asked questions

  • There is no ideal age to get life insurance. Some people prefer to wait until they have commitments such as a mortgage or a family before getting life insurance cover. Others prefer to get a policy as soon as possible. It’s important to note that life insurance is usually cheaper when you get it from an early age.

  • Not at all. Anyone can get life insurance if they reside in the UK and are between the ages of 18 and 59. You may want to consider joint life insurance if you have shared financial commitments, either with a life or business partner.

  • That depends on the policy. Some life insurance policies provide cover for 5-40 years, while others may cover up to the age of 69. The terms of the policy may also differ, so check all the details carefully before you agree to a policy.

  • Your loved ones may not get a payout if you fail to disclose information about your lifestyle or health when you apply for cover. A claim may also get rejected in the future, if you engage in high-risk activities. For example, scuba diving, bungee jumping, or off-roading. A lump sum payout can only be made after a valid claim is made by your beneficiaries.

Want to find out more?

Discover more information on life insurance and critical illness. Get a tailored quote or arrange a call-back to discuss your need.

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