Term life insurance can be a great option for those seeking affordable cover. Unlike whole life insurance, premiums tend to be cheaper because they only provide cover for a set time. However, when it comes to getting quotes for term life insurance, there are a number of factors that can impact premium rates.
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Type of policy
There are three types of term life insurance policies to choose from. Each has its own benefits for certain situations and needs:
Level cover
Level term cover is the standard type of policy that provides a fixed death benefit for the duration of the policy. Whether you pass away in the first year or the last, your beneficiaries will receive the same payout, which is chosen at the start of the policy.
It's often a reliable choice for families looking to secure financial support for their loved ones in the event of their death.
Decreasing cover
Decreasing term cover is designed for those with specific financial responsibilities that may decrease over time, such as a repayment mortgage. The payout declines gradually throughout the policy term, which aligns with the debt. It's often also called mortgage life insurance.
It’s an ideal option for individuals who want to ensure that their mortgage or other loans are paid off in case of their death.
Increasing cover
Increasing term cover provides a death benefit that rises annually, typically in line with inflation. While the payout increases, so does the cost of premiums, which can make this policy more expensive over time. It could be ideal for young families who expect their expenses to grow over the years.
Please note: The insurance products offered by Cavendish Online have no cash-in value at any time. If you stop paying your premiums, your cover will stop, your policy will end, and you will receive no benefit. If you have not claimed before the end of your chosen policy term, the policy will end, and no benefit will be paid.
The term length
When you purchase term cover, you do so for a set period of time as agreed by your insurer. This tends to range anywhere between 5-50 years and can be tailored to your specific needs. For example, let's say you want to buy cover to protect your mortgage if you die before it's repaid. You can simply take out a policy that matches the length of your loan.
The policy protects you during this time however long it may be. If you die outside the term, your insurer is not obligated to pay out any benefits.
The longer the term length you choose, the higher your premiums are likely to be. This is because the longer length provides more cover and increases the insurer's risk of having to pay out.
If you choose a shorter term, your premiums may be lower, but you will also have less time to benefit from the protection, which could leave you vulnerable if unexpected events arise.
For permanent protection, you may want to consider whole life insurance. This policy has no set term, providing ongoing cover instead. It is, however, often more expensive than term cover.
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Age
In most cases, the younger you are when you apply for cover, the lower your premiums could be. This is because younger people are statistically less likely to pass away during the term of the policy.
If you purchase a policy in your 20s or 30s, your premiums will generally be more affordable compared to someone in their 50s or 60s.
For those considering a term life policy, it’s advisable to lock in a plan while you’re still relatively young. Not only do you benefit from lower premiums, but you can also secure more extensive coverage during this crucial period in your life when financial responsibilities — such as mortgages, children, and other commitments — are often at their peak.
If you are aged 50 and over, you may be suited to an over-50s life insurance policy. These policies typically offer guaranteed acceptance regardless of health status, making them an appealing option for those who may have pre-existing medical conditions that could affect their ability to secure standard life insurance.
However, it’s worth noting that these policies often come with lower payout amounts, and there may be a waiting period before the full benefits are available.
Health
When you apply for life insurance, the insurer will ask you whether you have any pre-existing medical conditions or health issues. This information is crucial as it helps the insurer determine the level of risk associated with insuring you and will influence the cost of your premiums. Generally, the healthier you are, the lower your premiums will be.
For instance, if you have a history of serious health problems such as heart disease, diabetes, or cancer, your insurer may classify you as high-risk, resulting in higher premiums or possibly even denial of cover.
Cover amount
When it comes to life insurance, the more cover you choose, the higher you can expect to pay in premiums. This goes without saying that the cover amount should reflect your financial needs. It's essential to calculate how much your loved ones would need to maintain their lifestyle and meet any debts or obligations after your passing.
A general rule of thumb is to consider an amount of at least 10 to 15 times your annual income. This figure typically includes living expenses, outstanding mortgage balances, child support, and any other financial responsibilities.
Everyone's situation is different, so it's best to look for an amount that fits your specific needs and circumstances. For more information see: How much life insurance cover do I need?
Getting a quote for term life insurance
At Cavendish Online, we aim to make it as straightforward as possible to get a quote for life insurance.
We offer three easy routes to apply. For those confident in their choice, our low-cost online quote option lets you handle everything yourself. It’s perfect if you know what you need, are in good health, and feel comfortable managing the details, such as writing your policy in trust. With this option, you could be covered within 30 minutes.
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If you prefer expert guidance, our quote & apply with guidance route pairs you with a life insurance specialist who helps you select the right policy and navigate the process. This option is ideal for anyone seeking advice or dealing with minor health issues.
You can call our guidance team on
01329 24 87 35 (Monday to Thursday 10am – 7pm, Friday 10am – 6pm)
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Or if you'd prefer a professional recommendation, or your circumstances are more complicated due to a health condition, then our expert insurance advisers can help on
01392 436 193 (Monday to Thursday 9am – 5.30pm, Friday 9am – 5pm)
Whichever route you choose, Cavendish Online offers access to quality products from leading insurers, clear and upfront fees, and some of the lowest premiums available.
By applying online you could have life cover arranged in as little as half an hour. Start today to ensure your loved ones are protected for the future.
