Life insurance by age: A guide

Whatever stage of life you’re at, it’s important to understand what kind of life insurance you need, as well as how much. Everyone’s exact situation is different, so it’s important to take on board your own individual circumstances, including any financial commitments and cash reserves you have.

No one's path through life is completely linear. A life insurance policy needs to work for you. Make it a part of your plan and find comfort in knowing it’s there as a safety net to look after your loved ones.

What is the best age to get life insurance?

There's no definitive answer as to when is the right time to get cover. That said, if you have dependents, it's worth getting cover as soon as possible just in case something were to happen to you.

Life insurance tends to become more expensive as you age, which can result in higher monthly premiums. As long as you're over 18, you can buy life insurance as soon as you see fit. It may even be a result of a major life event such as getting married, becoming parents, or buying a property.

What types of life insurance are available?

It’s important to understand the differences between the two main types of life insurance:

Term life insurance runs for a fixed period of time (known as the ‘term’ of your policy) eg. 10, 15 or 25 years - but only pays out if you were to die during the term of the policy. There’s no lump sum payable at the end of the term if you outlive the policy, so these plans tend to be cheaper.

‘Whole-of-life’ insurance policies pay out regardless of when you die, as long as you keep up with your premium payments, but monthly premiums are more expensive due to the guaranteed payout.

TIP: Whole-of-life insurance is also known as life assurance by many insurers.

There are also additional forms of financial protection you may wish to consider, such as critical illness cover or income protection. While they don't cover you in the event of death, they can offer you and your loved ones support during challenging times.

Life Insurance in your 20s & 30s

Typically, when it comes to buying life insurance: the younger you are, the less expensive it will be. Monthly premiums are typically dependent on your age, health, among other factors so the sooner you buy, the cheaper it could be.

However, younger people tend to put off buying life insurance due to other financial concerns, such as car finance, student loan repayments and paying a mortgage. While paying bills is critical, missing out on buying a life insurance policy at a young age can be costly, much like delaying saving for your retirement.

If you have other people who depend on your income and you don’t already have life insurance in place, it’s important that you consider taking out a policy as soon as you can. 

It’s also worth bearing in mind that if you’re at the beginning of your financial journey, there will be lots of changes that will happen over the coming years. As these changes come, so will your insurance needs.

Life Insurance in your 40s & 50s

Many people say that life really does start at 40. Many of the initial financial pressures that come with being younger have now subsided; however, looking after yourself is now more important than ever.

As you’re now getting older, the likelihood of a medical condition developing starts to rise, and if a serious medical condition were to occur, so would the costs of taking out a policy or even the possibility of being ineligible for cover at all.

Up until now, you may have only considered a ‘term’ life insurance policy, which pays out a set amount if you pass away in a given period; yet, you may now want to start considering a ‘whole-of-life’ policy, which covers your life until you pass away.

Once you reach your 50s, you might also consider over 50s life insurance, a specific type of whole-of-life cover designed for people aged 50 and over. These policies are usually easy to take out, often with no medical questions required, and they guarantee a fixed payout when you die, provided you've paid your premiums for a set period.

Knowing the pros and cons of both to make an informed choice is absolutely crucial, and Cavendish can help.

Life Insurance in your 60s & beyond

Life insurance is important when your family relies on your income, but what about later in life? By the time you reach your 60s, your circumstances may have changed. Your children might now be financially independent, your mortgage may be paid off, and your focus could be shifting towards protecting your legacy or covering end-of-life expenses.

At this stage, many people consider guaranteed life insurance or over 50s life insurance.

Both are types of life cover designed to last for the rest of your life, not just a fixed term. That means whenever you pass away, a payout is guaranteed, as long as you’ve kept up with the premiums. This can provide peace of mind, knowing your loved ones will receive a lump sum to help with funeral costs, outstanding bills, or simply as a financial gift.

Because these policies guarantee a payout, they are typically more expensive than term insurance. However, the certainty they offer can be well worth it, especially if your goal is to leave something behind or make things easier for your loved ones when the time comes.

A way to cover Inheritance Tax

One of the biggest benefits of whole-of-life policies is that they can help your loved ones cover inheritance tax. For the 2024/2025 tax year, any estate worth over £325,000 may be subject to inheritance tax at 40% on anything above that threshold.

This bill usually has to be paid before your loved ones can access any of your estate. That can cause serious financial stress, especially if they need to pay tens of thousands of pounds out of pocket, just to unlock what you’ve left behind.

In some cases, families may be forced to take out a loan to pay the tax, which is far from ideal at such a difficult time.

Having a whole-of-life policy in place, written in trust, can help avoid this problem. The payout can go directly to your beneficiaries, giving them the money they need to cover the tax bill without borrowing or dipping into their own savings.

Leaving a legacy

Whole-of-life policies may also appeal if you want to leave something behind for your loved ones, whether it’s to help with funeral costs or provide a financial gift to family and/or loved ones.

It’s common for people to take out life insurance and never review the policy again. But over time, your needs can change, and so can your options. It’s worth checking whether your current policy still suits your situation, and if there are more cost-effective choices available.

That’s where Cavendish Online can help. We’ll guide you through your options and help you find the right cover, even later in life.

For the best rate and policy, shop around

Cavendish Online is committed to ensuring our fees and charges are highly competitive and transparent - so you know exactly what you are paying for when you use our different services. 

We can help you find the best and most affordable option for your individual circumstances, with products from leading financial service providers and the best value possible with minimal charge amounts.

To help find the best life insurance policy for you, we won’t limit your search to just one company.

Get A Quote Online Today

Once you’ve given this information some thought, it’s then really easy to arrange and compare online life insurance. Simply enter your details into our site and we’ll ask some questions to generate quotes so you’ll be able to see what policy works out best for you.

Prefer to phone?

Sometimes, it’s easier just to give us a call and speak one-to-one with one of our insurance specialists, who can guide you through the process and support you in choosing the best cover for you and your family.