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KAELTRIPTON · LIFE INSURANCE
UK life insurance research informed by the FCA's 2024 to 2025 thematic review of distribution, HMRC trust mechanics, and ABI protection claims data. Not a comparison-site checklist.
FCA-aware ·
2024 to 2025 review data ·
Tax-aware ·
Updated May 2026
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The FCA's thematic review of life insurance distribution, published in stages across 2024 and into Q1 2025, produced findings that did not receive the consumer press coverage they warranted. The review examined how commission structures across the broker and intermediary sector shaped the products sold to customers, and found systemic evidence that remuneration design was influencing product recommendations in ways that did not consistently serve consumer interests. Specifically, the review identified that joint-life policies were being recommended in cases where two single-life policies would have provided superior value for the customer, and that whole-of-life products with investment components were being sold to customers whose actual need was straightforward term assurance at a fraction of the cost. The ABI's protection claims statistics for 2024 show that life insurance claim acceptance rates remain high at over 97 percent for term assurance, but critical illness claim acceptance is materially lower due to condition definition disputes, a pattern the FOS's published complaint data corroborates. Against a backdrop of rising mortgage costs and an inheritance tax threshold freeze that pushes more estates above the nil-rate band with each passing year, the interaction between life insurance and IHT planning is a more consequential financial planning question for UK households in May 2026 than at any point in the previous decade.
Compare life insurance: a 2026 framework
The UK life insurance market divides into four primary product structures: level term assurance, decreasing term assurance, whole-of-life cover, and family income benefit. These are often conflated in retail marketing and on comparison platforms, but they serve different financial planning functions, carry different premium profiles, and have markedly different interactions with tax planning, mortgage protection, and estate management.
Level term assurance pays a fixed lump sum if the policyholder dies within a specified term. The sum assured does not change over the policy period; the premium is set at inception and, for guaranteed-premium policies, does not change either. It is the product best suited to family protection where the financial need is the replacement of income or the coverage of a fixed liability. Decreasing term assurance pays a sum that reduces over the policy term, typically in line with a repayment mortgage balance. The premium is lower than level term for the same initial sum and term because the expected payout reduces over time. It is purpose-built for repayment mortgages but ill-suited to interest-only mortgages, where the capital balance does not reduce. Whole-of-life cover provides cover for the policyholder's entire lifetime rather than a fixed term; it pays on death whenever that occurs. The certainty of eventual payout makes it structurally more expensive than term cover. Whole-of-life policies come in two main forms: guaranteed-premium whole-of-life, where the premium is fixed for life, and investment-linked whole-of-life, where the premium or sum assured is reviewed periodically against underlying fund performance. The FCA's 2024 review found investment-linked whole-of-life products among those where commission structures most significantly distorted distribution. Family income benefit pays a regular monthly or annual income to dependants from the date of death to the end of the policy term, rather than a single lump sum. It replicates the salary-replacement function of life cover more directly than a lump sum does, at a lower premium than level term for equivalent total payout.
| Dimension | Level term | Decreasing term | Whole-of-life | Family income benefit |
|---|---|---|---|---|
| Payout structure | Fixed lump sum | Reducing lump sum | Lump sum on death (any time) | Monthly income to end of term |
| Premium pattern | Fixed for term (guaranteed) or reviewable | Fixed; lower than level term | Fixed or reviewable; higher than term | Fixed; often lowest premium per £ of total benefit |
| Primary use case | Family protection; interest-only mortgage; business key person | Repayment mortgage cover | IHT planning; estate equalisation; funeral costs | Income replacement for dependants |
| Tax treatment of payout | Outside estate if written in trust; forms part of estate if not | Outside estate if written in trust | Outside estate if written in trust; critical for IHT planning | Outside estate if written in trust; income payments may be subject to income tax in recipient's hands |
| Common pitfall | Not written in trust; sum assured forms part of taxable estate | Used for interest-only mortgage where balance does not reduce | Investment-linked version reviewed upward at premium review; cost basis not understood at sale | Income stream stops at end of term regardless of dependant age; shorter terms leave gaps |
Term assurance: when fixed-period cover makes sense
Term assurance is the most widely purchased individual protection product in the UK, and the category with the highest claim acceptance rate in the ABI's statistics. Its function is direct: it pays a defined sum if the insured person dies within a specified period, and pays nothing if they do not. The premium is set at underwriting and, for guaranteed-premium policies, does not change for the life of the policy regardless of changes in the policyholder's health, occupation, or habits after inception.
The sum assured calculation is a consequential decision that receives inadequate attention in the retail purchase process. A rule of thumb of ten times annual salary is widely cited but poorly calibrated to actual household financial structures. The relevant inputs are: the capital required to extinguish any mortgage or secured debt, the income replacement required for the surviving parent's household to maintain its standard of living, the cost of childcare that the deceased would otherwise have provided or funded, and a time horizon that reflects the youngest dependent child's age to financial independence. For many households with younger children and a mortgage, the appropriate sum assured exceeds the rule of thumb figure.
Consider Sarah, 38, with two children aged 4 and 7, and a £280,000 interest-only mortgage with a remaining term of 22 years. Her household income is £52,000 per year. A decreasing term policy sized against her mortgage balance would be inadequate because the mortgage is interest-only and the capital balance does not reduce over the term: she needs level term cover for the full £280,000 to be maintained until the mortgage matures. In addition to the mortgage liability, the income replacement function requires a further calculation. If her surviving partner earns £34,000 per year, the income gap to maintain the household at current standard is approximately £18,000 per year. Capitalised over the remaining years until the younger child reaches 18, a 14-year income period at £18,000 per year suggests an additional £252,000 of cover, producing a total sum assured requirement of approximately £532,000.
| Component | Sarah's calculation | Note |
|---|---|---|
| Mortgage capital (interest-only) | £280,000 level over 22 years | Decreasing term unsuitable; balance does not reduce |
| Income gap (£52K minus £34K) | £18,000 per year | To maintain household standard of living |
| Income replacement term (to youngest child age 18) | 14 years | From now; child currently aged 4 |
| Capitalised income replacement (simple; no discount rate) | £252,000 | 14 years x £18,000; actual net present value lower |
| Childcare and household cost uplift | £30,000 to £50,000 estimate | Dependent on local childcare market |
| Indicative total sum assured | £560,000 to £580,000 | Significantly above 10x salary rule of thumb (£520K) |
Whole-of-life cover: economics and IHT planning
Whole-of-life insurance is a categorically different product from term assurance, and its economic logic is categorically different too. It is not a cheap form of protection against an uncertain risk: it is a guaranteed payout product where the only variable is timing. Because the insurer knows with certainty that it will pay out at some point, the premium must be structured to recover the expected claim cost plus the insurer's expense and profit load over the policyholder's expected lifetime. For policies incepted at younger ages, the premium can look superficially competitive with term assurance but remains fundamentally a different financial commitment.
The primary legitimate use cases for whole-of-life cover in the UK are IHT planning and funeral cost provision. For estates that exceed the current nil-rate band (£325,000 for individuals, £650,000 for married couples using the full transferable nil-rate band, and up to £1 million including the residence nil-rate band) the inheritance tax liability is a known and quantifiable future cost. A whole-of-life policy written in trust, where the payout falls outside the policyholder's estate, can be sized to meet the expected IHT liability. The premium is funded by the policyholder during their lifetime, and the trust pays the HMRC inheritance tax bill shortly after death, enabling beneficiaries to receive the remainder of the estate without being forced to sell property to meet the tax charge.
The IHT nil-rate band has been frozen at £325,000 since 2009 and, as of May 2026, remains frozen under current government policy until at least 2028. The effect of this freeze, combined with rising property values across most UK regions, is that a growing proportion of UK estates are drawn above the nil-rate band without their owners having taken active steps to manage the exposure. HMRC's inheritance tax receipts data, published quarterly, shows a consistent year-on-year increase in estates paying IHT since 2021.
Premium escalation in reviewable whole-of-life products is a significant consumer risk documented in the FCA's 2024 thematic review. Investment-linked whole-of-life policies are subject to regular premium or sum assured reviews based on the performance of the underlying with-profits or unit-linked fund. Where the fund underperforms relative to the assumptions at inception, the policyholder faces a choice at review: pay a substantially higher premium to maintain the original sum assured, accept a reduced sum assured at the original premium, or surrender the policy. For older policyholders in ill health at the time of review, surrendering means losing the cover entirely at the point when it has the most value.
| Policy type | Premium stability | Sum assured at death | IHT planning suitability | Approximate monthly premium (£200K cover, age 55) |
|---|---|---|---|---|
| Guaranteed whole-of-life | Fixed for life | Guaranteed; no review | High; predictable liability cover | £180 to £320 |
| Reviewable whole-of-life (with-profits) | Reviewed every 5 to 10 years; may increase significantly | Fund-dependent; may reduce at review | Lower; review risk undermines certainty | £90 to £180 initially (may escalate substantially) |
| Over-50s plan (simplified whole-of-life) | Fixed | Fixed but low relative to total premiums paid for longer-lived policyholders | Low; better suited to funeral cost provision than IHT planning | £20 to £60 (sum assured typically £3K to £15K) |
Critical illness cover: where it pays and where it does not
Critical illness cover pays a lump sum on diagnosis of a specified serious condition rather than on death. It is frequently bundled with life insurance in retail distribution, and the bundling is not always to the consumer's benefit. The two products address different financial risks: life insurance covers the financial impact on dependants of the policyholder's death; critical illness cover addresses the financial impact on the policyholder of a serious but survivable illness. For households without significant savings, the loss of income and increase in care costs following a cancer diagnosis, stroke, or heart attack can be financially catastrophic even if the policyholder survives. Critical illness cover is the insurance product designed to address that risk.
Claim acceptance rates for critical illness cover are materially lower than for term life insurance. The ABI's protection claims statistics for 2024 show that critical illness claims are declined at rates significantly higher than life claims, with the primary reasons being conditions not meeting the policy's definition severity threshold, conditions excluded as pre-existing, and conditions not included in the policy's covered conditions list at all. The scope of covered conditions varies substantially between policies: a standard policy might cover 40 to 50 defined conditions; a comprehensive policy from a specialist provider might cover 100 or more. The severity threshold for covered conditions, which specifies how advanced a condition must be before a claim is valid, is the single most important comparison variable and is not visible in headline benefit comparisons on aggregator platforms.
Children's critical illness cover, which extends a critical illness policy to cover named conditions in dependent children, is available as a standard or optional extension. The covered conditions for children are typically different from adult conditions, reflecting the different disease profile of children, and may include conditions not covered under the adult policy. For households with young children, this extension merits specific evaluation rather than assumption that adult cover terms apply.
| Condition category | ABI 2024 claim acceptance rate (approx.) | Primary reason for declines |
|---|---|---|
| Cancer (all types) | Approx. 91 to 94 percent | Early-stage cancer not meeting definition severity; non-invasive cancers excluded in some policies |
| Heart attack | Approx. 89 to 93 percent | Troponin or enzyme threshold not met; definition severity requirement not satisfied |
| Stroke | Approx. 85 to 91 percent | TIA (transient ischaemic attack) not meeting stroke definition; permanent symptoms requirement |
| All critical illness claims (overall) | Approx. 92 percent (ABI 2024 data) | Condition outside policy definition; pre-existing condition; non-disclosure at inception |
Source: ABI protection insurance claims statistics 2024. Figures are approximate market averages; individual insurer acceptance rates vary.
Family income benefit: the income-not-lump-sum alternative
Family income benefit (FIB) is among the least discussed protection products in consumer media, despite offering what many financial planners consider a more financially rational structure than level term for pure income replacement purposes. Instead of paying a lump sum on death, a FIB policy pays a regular monthly or annual income to the surviving household from the date of death to the end of the policy term. The premium for a FIB policy is typically lower than for a level term policy of equivalent total benefit, because the present value of a series of future income payments is lower than the same total amount paid as a lump sum today.
The income structure also removes the investment management burden from the bereaved household. A level term lump sum requires the surviving spouse or partner to invest the capital, manage the drawdown, and bear the investment risk during what is typically a period of significant emotional and practical disruption. A FIB policy removes this requirement by delivering money when it is needed rather than requiring the household to manage a large capital sum.
To illustrate the economics: a 35-year-old purchasing a 25-year level term policy for £400,000 sum assured might pay approximately £25 to £40 per month in guaranteed premiums. A FIB policy designed to pay £1,500 per month for the same 25-year term, with a total maximum payout of £450,000 if the claim occurred in year one, might cost approximately £18 to £28 per month. The lower premium reflects the declining expected payout as the term advances. If the policyholder dies in year 20, the FIB pays £1,500 per month for 5 remaining years, a total payout of £90,000, whereas a level term policy would still pay the full £400,000. This dynamic makes FIB most suitable for households where the primary risk is the income gap during the period of dependent children, rather than a large capital liability that must be extinguished at any point during the term.
Joint versus single life policies: the broker commission question
Joint life policies insure two people under a single policy and pay out once, on the first death. After the first claim, the policy terminates and the surviving person has no cover. Two single-life policies insure each person separately, pay out on each death independently, and leave the surviving person still covered until their own policy's expiry or claim.
The practical consequence of this structural difference is significant for couples with dependants. A joint first-death policy pays on the first death but leaves the survivor uninsured at the very point when their financial need may be greatest, specifically when they are a surviving parent responsible for dependent children. Two single-life policies ensure that the survivor retains their own cover following the partner's death, and that a second payout is available to the children's guardians in the event of the survivor's subsequent death.
The FCA's thematic review of life insurance distribution, conducted across 2024 and into Q1 2025, found evidence at multiple firms that joint policies were being recommended in preference to two single-life policies in circumstances where the two single-life structure would have delivered better value for the customer. The review identified that joint policies generate a single commission payment, which is often structured at a higher rate than the combined commission on two smaller single-life policies, and that this incentive was influencing intermediary recommendations. The review resulted in supervisory engagement with named firms and a requirement to conduct past business reviews to identify customers who may have been disadvantaged by the recommendation.
James and Priya, both aged 42 with two children and a combined household income of £110,000, illustrate the economics. A joint first-death level term policy for £500,000 over 20 years would cost approximately £70 to £100 per month in guaranteed premiums. Two separate level term policies for £400,000 each over 20 years would cost approximately £80 to £120 per month combined. The modest premium differential, often around £10 to £20 per month in favour of the joint policy, is in most cases outweighed by the structural advantage of two independent claims available over the term.
| Factor | Joint first-death policy | Two single-life policies |
|---|---|---|
| Number of payouts available | One (on first death only) | Two (one per person) |
| Survivor's cover after first claim | None; policy terminates | Maintained until their own policy term ends |
| Typical monthly premium differential | Approximately £10 to £20 cheaper per month | Baseline |
| FCA 2024 to 2025 review finding | Overrecommended relative to consumer need; commission structure implicated | Underrecommended relative to consumer need |
| Best suited to | Couples without dependants where second-death cover is not required; mortgage joint protection only | Couples with dependent children; households where second-death cover matters |
Inheritance tax planning and life insurance in trust
A life insurance policy that is not written in trust forms part of the policyholder's estate on death and is subject to inheritance tax at 40 percent on the value above the nil-rate band. For a policyholder whose estate including the insurance payout exceeds the nil-rate band, a significant portion of the intended benefit is diverted to HMRC rather than to beneficiaries. Writing the policy in trust removes it from the estate entirely: the trust owns the policy from inception, the payout goes to the trust on death, and the trustees distribute it to beneficiaries outside the probate process and free of IHT.
The mechanics of writing life insurance in trust are administratively straightforward. Most UK life insurers offer a standard trust deed specific to their policies, typically as a simple document completed at the time of policy inception at no additional cost. The policyholder becomes the settlor of the trust and nominates trustees (often a spouse or adult children) and beneficiaries. The trust is a bare trust or a discretionary trust depending on the insurer's deed; each has different flexibility in terms of how benefits are distributed among beneficiaries.
HMRC's Inheritance Tax Manual (IHTM) governs the treatment of life insurance policies for IHT purposes. Section IHTM20251 sets out the conditions under which a policy written in trust falls outside the estate. The key condition is that the settlor must not retain any benefit under the trust; a policy where the policyholder can unilaterally revoke the trust or receive benefits from it does not achieve the IHT planning objective. The seven-year gifting rule does not apply to bare trust life insurance policies because the premium payments are typically within the annual gifts exemption or qualify as normal expenditure out of income; specialist tax advice is warranted for larger premium commitments.
The interaction between life insurance trusts and the IHT nil-rate band freeze, which has held at £325,000 since 2009 and is projected to remain frozen until at least 2028 under current policy, means that the proportion of UK estates for which this planning is relevant has grown substantially. HMRC's quarterly IHT receipts data consistently shows year-on-year increases in taxable estates, driven primarily by property value appreciation in the period between 2013 and 2023.
| Step | Action | HMRC / regulatory reference |
|---|---|---|
| 1 | Assess whether estate will exceed nil-rate band (currently £325K individual; up to £1M with residence NRB and transferable NRB) | HMRC IHT manual IHTM11000 |
| 2 | Select guaranteed whole-of-life policy sized to expected IHT liability | ABI protection product guidance |
| 3 | Complete insurer's trust deed at inception; appoint trustees and beneficiaries | HMRC IHTM20251; trust deed provided by insurer |
| 4 | Confirm premiums qualify as normal expenditure out of income or fall within annual gifts exemption (£3,000 per year) | HMRC IHTM14231 (normal expenditure); IHTM14141 (annual exemption) |
| 5 | On death: trustees claim the policy proceeds; pay HMRC IHT liability; distribute remainder to beneficiaries outside probate | IHTM20251; HMRC IHT400 process |
Comparison sites: what they miss for life cover
The UK life insurance comparison market has a similar structural gap to the travel insurance market: several significant providers distribute exclusively or predominantly through direct or broker channels and are absent from the main aggregator platforms. As of Q1 2026, providers including Legal and General, Vitality, and some specialist impaired lives underwriters either do not list on the main PCWs or list only a subset of their product range. The aggregator results panel for life insurance therefore represents a sample of the market rather than the full picture.
The gap is most material for impaired lives underwriting. A standard PCW quote engine processes a simplified medical declaration and produces a quote, or declines. A specialist broker with access to the full impaired lives market can obtain manual underwriting assessments from multiple providers for conditions that trigger automatic declines on aggregators: controlled Type 2 diabetes, treated depression, a history of cancer now in remission, elevated BMI, or occupational risk factors. The premium differential between an aggregator-accessible standard market quote and a specialist-underwritten impaired lives quote can be substantial, but so can the coverage differential. A standard market quote for a person with a cardiac history may include a blanket cardiac exclusion; a specialist underwriter may offer full cover with a premium loading.
The FCA's 2024 thematic review also found that whole-of-life products, which are primarily distributed through broker channels rather than aggregators, were subject to the commission distortions documented in the review. The implication for consumers is that a broker recommendation for a whole-of-life product should be accompanied by a clear illustration of the broker's remuneration and an explanation of why whole-of-life rather than term assurance was selected for the customer's stated need. Under Consumer Duty, insurers and intermediaries are required to ensure this information is available to customers.
All life insurance guides
Coming soon:
- Critical illness cover UK 2026: conditions, definitions and claim rates
- Family income benefit UK: income vs lump sum explained
- Life insurance in trust UK: HMRC rules and trust mechanics
- Decreasing term mortgage life insurance UK
- Life insurance with pre-existing conditions UK
- Over-50s life insurance UK: economics and alternatives
Sources
- Financial Conduct Authority, thematic review of life insurance distribution (2024 to 2025), Dear CEO letter and supervisory engagement: fca.org.uk/firms/insurance
- Financial Conduct Authority, Insurance Conduct of Business Sourcebook (ICOBS): fca.org.uk/firms/insurance/insurance-conduct-business-sourcebook
- HMRC, Insurance Policyholder Taxation Manual: gov.uk/hmrc-internal-manuals/insurance-policyholder-taxation-manual
- HMRC, Inheritance Tax Manual (IHTM), including IHTM20251 on life insurance in trust and IHTM14231 on normal expenditure out of income: gov.uk/hmrc-internal-manuals/inheritance-tax-manual
- Association of British Insurers, protection insurance claims statistics 2024: abi.org.uk/data-and-research/reports-and-publications/
- Financial Ombudsman Service, life insurance complaint data and annual review: financial-ombudsman.org.uk/data-insight/annual-review
- gov.uk, inheritance tax and writing life insurance in trust: gov.uk/inheritance-tax
- HMRC, inheritance tax receipts quarterly statistics: gov.uk/government/collections/hmrc-tax-and-nic-receipts
| Editorial disclaimer: Kaeltripton is not authorised or regulated by the Financial Conduct Authority to give regulated financial advice. All content on this page is informational and educational only, and does not constitute a personal recommendation to purchase any insurance or protection product. Premium ranges cited are indicative estimates based on market research at the time of publication; actual quotes depend on individual health, occupation, and insurer underwriting. Tax treatment of life insurance products depends on individual circumstances; readers should seek advice from an FCA-authorised financial adviser and a qualified tax adviser for decisions involving inheritance tax planning or trust structures. |
Frequently asked questions
What is the difference between term and whole-of-life insurance?
Term assurance pays a lump sum if the policyholder dies within a fixed period, such as 25 years, and pays nothing if the policyholder outlives the term. It is designed for protection against uncertain risk during a defined period of financial vulnerability, such as a mortgage or the years of dependent children. Whole-of-life insurance pays on death whenever it occurs, making it a certainty rather than an uncertainty. The certainty of payout makes whole-of-life structurally more expensive. Its primary legitimate use cases are inheritance tax planning and funeral cost provision rather than standard family protection.
How much life insurance do I need?
The relevant inputs are: the capital required to extinguish any mortgage or secured debt at any point during the cover period; the income gap between the household's current joint income and the surviving partner's income; the number of years until dependent children reach financial independence; and any capital required for childcare or educational costs. A rule of thumb of ten times annual salary is a widely cited starting point but is frequently an underestimate for households with young children, significant interest-only mortgage debt, or large income disparities between partners.
Should I buy life insurance through a broker or a comparison site?
For straightforward needs, a healthy adult in their thirties or forties with a standard repayment mortgage and no significant medical history, comparison sites provide efficient access to mainstream market pricing. For more complex needs, including pre-existing conditions, high-value cover, whole-of-life with IHT planning intent, or key-person business cover, a specialist broker accesses manual underwriting and products not available on aggregator platforms. The FCA's Consumer Duty requires brokers to disclose their remuneration and explain their recommendation rationale; this transparency is worth using to understand whether a broker's recommendation reflects your needs or their commission structure.
What did the FCA's 2024 to 2025 life insurance review find?
The FCA's thematic review of life insurance distribution found systemic evidence that commission structures were shaping product recommendations away from consumer-appropriate products. Specifically, joint-life policies were being overrecommended relative to two single-life policies in cases where the two-policy structure offered better value, and investment-linked whole-of-life products were being sold to customers whose actual need was straightforward term assurance at lower cost. The review led to supervisory engagement with named firms and requirements to conduct past business reviews. A Dear CEO letter was issued to the sector in early 2025.
Is critical illness cover worth adding to a life insurance policy?
Critical illness cover and life insurance address different risks. Life insurance provides for dependants if you die; critical illness cover provides a lump sum to you if you are diagnosed with a serious survivable illness. The case for adding critical illness cover is strongest for households without significant savings, self-employed individuals without employer sick pay, and households with mortgage debt where a period of incapacity would create acute financial pressure. The value depends entirely on the scope of covered conditions and the severity thresholds in the specific policy; ABI data shows overall acceptance rates of around 92 percent but with significant variation by condition type.
How does writing life insurance in trust affect inheritance tax?
A life insurance policy not written in trust forms part of the policyholder's estate on death and is subject to IHT at 40 percent on the value above the nil-rate band. Writing the policy in trust removes the payout from the estate entirely: the trust receives the proceeds outside probate, and trustees distribute them to beneficiaries free of IHT. Most UK life insurers provide a standard trust deed at no additional cost at policy inception. HMRC's Inheritance Tax Manual section IHTM20251 sets out the conditions for this treatment. The nil-rate band has been frozen at £325,000 since 2009 and remains frozen under current policy until at least 2028.
Joint life or two single-life policies for couples?
A joint first-death policy pays once, on the first death, after which the policy terminates and the survivor has no cover. Two single-life policies each pay independently, leaving the survivor still insured. For couples with dependent children, the two single-life structure is structurally more appropriate because it ensures the surviving parent retains cover. The premium saving from a joint policy is typically £10 to £20 per month: modest relative to the cover differential. The FCA's 2024 to 2025 review found joint policies being overrecommended at multiple firms due to commission incentives, and resulted in past-business review requirements.
Does life insurance pay out for suicide?
Most UK life insurance policies include a suicide exclusion for a defined period after inception, typically 12 to 24 months, after which suicide is a covered cause of death in the same way as any other cause. The exclusion period varies by insurer and is disclosed in the policy terms at inception. After the exclusion period has elapsed, a claim following suicide will be assessed on the same basis as any other life claim, with payout subject to the standard claims assessment process including confirmation of the sum assured and that the policy was in force at the time of death. The ABI's claims data does not separately categorise cause of death in published statistics.
What is the difference between guaranteed and reviewable premiums?
Guaranteed premiums are fixed at the time of underwriting and do not change for the life of the policy regardless of the policyholder's changing health, occupation, or age. Reviewable premiums are set at inception but can be increased by the insurer at specified review intervals, typically every five or ten years, based on the insurer's claims experience, investment returns, and administrative costs. Reviewable premiums are typically lower at inception but carry the risk of significant increases at review, particularly for older policyholders. For protection planning purposes, guaranteed premiums provide certainty of cost that reviewable premiums do not; the initial cost differential should be weighed against this long-term certainty.
Can I get life insurance with a pre-existing condition?
Yes, in most cases. Standard comparison site quote engines process simplified medical declarations and may decline or apply standard exclusions for common conditions. A specialist broker with access to the impaired lives market can obtain manual underwriting assessments from multiple providers for conditions including controlled Type 2 diabetes, treated mental health conditions, cancer history in remission, elevated BMI, and cardiac history. The outcome of manual underwriting may be a premium loading, a specific exclusion for the condition in question, or full cover at standard terms depending on the insurer and the clinical specifics. Non-disclosure of a condition to obtain a lower premium risks voiding the policy at claim stage.