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Family Income Benefit Life Insurance UK

WeCovr Editorial Team · experienced insurance advisers
Last updated Feb 2, 2026
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TL;DR

Protecting your family's financial future is one of the most important responsibilities you have. When you think of life insurance, you probably picture a large, one-off lump sum payment. But what if there was a different way?

Key takeaways

  • Standard Level Term Life Insurance (illustrative): This is like a lottery win for your family. They receive a large sum (e.g., £250,000) which they must then manage, invest, and draw from to cover their expenses for many years to come.
  • Family Income Benefit (illustrative): This is like a replacement salary. Your family receives a steady, predictable income (e.g., £2,000 every month) that they can use to pay for regular outgoings just as they did when you were there.
  • Income Amount (illustrative): £2,500 per month
  • Policy Term: 25 years (designed to last until her youngest child is 23)
  • Illustrative estimate: The policy starts paying out £2,500 per month to her family.

Protecting your family's financial future is one of the most important responsibilities you have. When you think of life insurance, you probably picture a large, one-off lump sum payment. But what if there was a different way? A way that mimics your monthly salary, ensuring your family can continue to manage their finances and pay the bills without the pressure of handling a huge sum of money during a difficult time.

This is where Family Income Benefit (FIB) comes in. It's a type of life insurance that is often more affordable and practical for young families, but it remains one of the most misunderstood protection products on the UK market.

This comprehensive guide will demystify Family Income Benefit. We will explore exactly what it is, who it’s for, and most importantly, we will provide a detailed explanation of how this unique policy pays out over time, giving your loved ones long-term security when they need it most.

Explaining How This Policy Type Pays Out Over Time

The single most important feature that sets Family Income Benefit apart from standard life insurance is its payout structure. Instead of providing a single, large cash lump sum upon your death, an FIB policy pays out a regular, tax-free monthly or annual income.

Think of it this way:

  • Standard Level Term Life Insurance (illustrative): This is like a lottery win for your family. They receive a large sum (e.g., £250,000) which they must then manage, invest, and draw from to cover their expenses for many years to come.
  • Family Income Benefit (illustrative): This is like a replacement salary. Your family receives a steady, predictable income (e.g., £2,000 every month) that they can use to pay for regular outgoings just as they did when you were there.

The payments start on the policyholder's death and, crucially, continue until the end of the pre-agreed policy term. This means the total amount paid out depends on when a claim is made during the term.

Let's illustrate this with a clear example.

Example: Sarah's Family Income Benefit Policy

Sarah, a 35-year-old mother of two young children, takes out a Family Income Benefit policy.

  • Income Amount (illustrative): £2,500 per month
  • Policy Term: 25 years (designed to last until her youngest child is 23)

Here are a few scenarios to show how the payout works:

Scenario 1: Claim in Year 5 Sarah tragically passes away 5 years into her 25-year policy.

  • Illustrative estimate: The policy starts paying out £2,500 per month to her family.
  • These payments will continue for the remaining 20 years of the term.
  • Total Payout (illustrative): £2,500/month x 12 months x 20 years = £600,000

Scenario 2: Claim in Year 20 Sarah passes away 20 years into the policy term.

  • Her children are now young adults.
  • Illustrative estimate: The policy starts paying out £2,500 per month.
  • These payments will continue for the remaining 5 years of the term.
  • Total Payout (illustrative): £2,500/month x 12 months x 5 years = £150,000

Scenario 3: No Claim Sarah outlives the 25-year policy term.

  • The policy expires.
  • No claim is made, and no money is paid out. The premiums paid have provided 25 years of peace of mind.

This "decreasing potential payout" is a core feature. As time goes on, your children get older, your mortgage gets smaller, and your family's financial dependency on you naturally reduces. The policy reflects this, which is a key reason why Family Income Benefit premiums are often significantly lower than for a level term policy with a large lump sum.

Payout Over Time: A Visual Comparison

Policy Year of ClaimRemaining TermMonthly IncomeTotal Payout
Year 124 Years£2,500£720,000
Year 1015 Years£2,500£450,000
Year 1510 Years£2,500£300,000
Year 241 Year£2,500£30,000

As you can see, the policy provides the highest level of financial support in the earliest years, which is precisely when your family is likely to be at its most vulnerable.

What is Family Income Benefit Insurance? A Deeper Dive

Now that we understand the payout mechanism, let's formally define Family Income Benefit and its key components.

Family Income Benefit (FIB) is a specific type of term life insurance. It is designed to provide your dependants with a regular, tax-free income from the time of your death until the end of the policy term.

Let's break down its core characteristics:

  • Term Insurance: Like other term policies, FIB only covers you for a fixed period (the "term"), for example, 20, 25, or 30 years. If you pass away within this term, the policy pays out. If you survive the term, the cover ends.
  • Income Payout: As we've covered, its defining feature is the income stream rather than a lump sum. This makes it ideal for replacing a lost salary and covering ongoing household expenditures.
  • Tax-Free Payments: The income received by your beneficiaries is not subject to income tax or capital gains tax, making it a highly efficient way to deliver financial support.
  • Affordability: Because the insurer's total potential liability decreases each year, the risk for them reduces over time. This saving is passed on to you in the form of lower premiums compared to a level term policy with a comparable overall payout in the early years.

Who is Family Income Benefit For? The Ideal Candidate

While any individual with financial dependants could benefit from this cover, FIB is particularly well-suited to certain groups and life stages. According to the Office for National Statistics, there were 19.4 million families in the UK in 2023, with millions of them having dependent children who rely on parental income.

You should strongly consider Family Income Benefit if you are:

  • A Parent with Young Children: This is the primary market for FIB. You can set the policy term to coincide with your children reaching financial independence, perhaps age 21 or 25. The income can cover everything from daily living costs to childcare and school or university expenses.
  • A Homeowner with a Repayment Mortgage: The regular income can be used to ensure monthly mortgage payments are always met, removing the risk of your family losing their home.
  • A Single Parent: For a single parent, FIB can be an incredibly cost-effective way to create a robust financial safety net, ensuring a consistent income for your children's upbringing if the worst were to happen.
  • Someone whose Partner has Limited Earning Capacity: If your partner works part-time or is a stay-at-home parent, your income is vital. FIB replaces that income, allowing them to maintain their role and standard of living without immediate financial pressure to return to full-time work.
  • Self-Employed Individuals and Freelancers: When your income can be variable, providing a guaranteed, fixed monthly income for your family offers unparalleled peace of mind.
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Family Income Benefit vs. Level Term Life Insurance: A Head-to-Head Comparison

Choosing the right type of life insurance depends entirely on what you want the money to achieve. Both FIB and traditional Level Term insurance have their place, and for some, a combination of the two is the perfect solution.

Here is a clear comparison to help you decide:

FeatureFamily Income BenefitLevel Term Life Insurance
Payout MethodRegular monthly/annual income.A single, tax-free lump sum.
Payout PurposeReplaces lost salary, covers bills and ongoing costs.Pays off large debts (e.g., mortgage), provides investment capital.
Financial BurdenSimple for beneficiaries to manage, integrates into their budget.Requires careful financial planning and investment knowledge.
Risk of MismanagementLow. The income structure prevents rapid overspending.Higher. A large sum can be spent quickly or invested poorly.
Premiums (Cost)Generally lower and more affordable.Higher for a comparable level of cover.
Best For...Families needing to cover day-to-day living expenses.Individuals wanting to clear debts and provide an inheritance.

Ultimately, the choice isn't about which is "better," but which is "better for your family's needs."

  • Use Family Income Benefit to: Cover the monthly bills, food, childcare, school fees, and car payments.
  • Use Level Term Life Insurance to: Pay off the mortgage in full, clear all outstanding loans, and provide a fund for university fees or a house deposit for children in the future.

Many people find that a hybrid approach is best. A smaller lump sum policy to clear the mortgage, combined with an FIB policy to provide a monthly income, can be a comprehensive and affordable strategy. An expert adviser at WeCovr can help you analyse your needs and model different scenarios to find the perfect blend.

The Financial Advantages of a Regular Income Payout

The idea of a regular income might seem less dramatic than a £500,000 lump sum, but its practical advantages are immense, especially for a family navigating grief. (illustrative estimate)

  1. Budgeting Made Simple: Your loved ones won't be faced with the daunting task of investing a large sum of money. The income simply replaces your salary, allowing them to continue paying bills and managing household finances in a familiar way. This removes a significant source of stress during an already traumatic time.

  2. Protection from Inflation: A major concern with a fixed income is that its purchasing power will be eroded over time by inflation. To combat this, you can choose an index-linked or increasing cover option. This ensures the income amount increases each year, typically in line with the Retail Prices Index (RPI) or by a fixed percentage (e.g., 3% or 5%). This keeps the income's value consistent with the rising cost of living.

  3. Reduced Risk of Financial Mismanagement: It's a sad reality that large financial windfalls can be mismanaged. Beneficiaries, overwhelmed by grief and perhaps lacking financial experience, can fall prey to poor advice or make rash spending decisions. An income stream provides a safety rail, ensuring the money lasts for the intended period.

  4. Excellent Tax Efficiency: The income payments from an FIB policy are paid free of income tax and capital gains tax. If the policy is written 'in trust', the payout also falls outside your estate for Inheritance Tax (IHT) purposes, ensuring the maximum benefit reaches your family quickly and efficiently.

How to Choose the Right Level of Cover and Policy Term

Determining the right amount of cover is simpler than you might think. It’s a case of working backwards from your family's monthly needs.

Step 1: Calculate Your Required Monthly Income

Grab a pen and paper or open a spreadsheet and tally up your family's essential monthly outgoings.

  • Housing: Mortgage or rent payments
  • Household Bills: Council tax, gas, electricity, water, broadband, phone lines
  • Transport: Car payments, fuel, insurance, public transport costs
  • Food & Groceries: Your weekly shop
  • Childcare: Nursery fees, childminder costs, after-school clubs
  • Education: School fees, uniforms, trips, university savings
  • Debts: Credit card and loan repayments
  • Lifestyle: Hobbies, subscriptions (gym, streaming), family holidays

Once you have a total, subtract any income your surviving partner would have, plus any state benefits they might be entitled to (e.g., Bereavement Support Payment). The remaining figure is the monthly income gap your Family Income Benefit policy needs to fill.

Step 2: Determine the Ideal Policy Term

The policy term should be based on how long your family will be financially dependent on you. Think about your biggest financial commitments and when they are due to end.

  • For families with children: The most common approach is to set the term to last until your youngest child reaches a certain age, such as 18, 21, or even 25 if you plan to support them through higher education.
  • For mortgage holders: You could align the term with the remaining term of your mortgage, ensuring it will be fully paid off even if you're not there.
  • For your retirement: You could set the term to last until your planned retirement age, at which point your pensions and other investments would take over.

The Importance of Adding Critical Illness Cover

What if you didn't pass away, but suffered a life-changing illness that prevented you from working? According to the Association of British Insurers (ABI), insurers paid out a staggering £1.27 billion in critical illness claims in 2022 alone. A serious diagnosis can be financially devastating.

This is where combining Critical Illness Cover (CIC) with your Family Income Benefit policy is so powerful.

If you add CIC, the policy will start paying the monthly income not just upon death, but also if you are diagnosed with one of the specific serious illnesses listed in the policy (such as some forms of cancer, heart attack, or stroke).

This creates a robust safety net that protects your family's income against both death and serious illness. The income can replace your lost earnings, allowing you to focus on your recovery without worrying about the monthly bills.

Specialist Protection: Solutions for Business Owners and the Self-Employed

The need for a reliable income stream is universal, but the solutions can be tailored for those who run their own business or work for themselves.

For the Self-Employed and Freelancers

Family Income Benefit is a perfect fit for freelancers, contractors, and sole traders. When your income fluctuates month to month, having a policy that provides a guaranteed, fixed income for your family is invaluable. It removes the uncertainty and provides a solid foundation for your family's financial security.

It's also important to distinguish FIB from Income Protection.

  • Income Protection: Pays a monthly income to you if you can't work due to illness or injury. It protects your ability to earn.
  • Family Income Benefit: Pays a monthly income to your family if you pass away. It protects your dependants.

The two policies are complementary, not mutually exclusive, and form the bedrock of a comprehensive protection plan for any self-employed person.

For Company Directors

If you are a director of your own limited company, you have access to a highly tax-efficient way to arrange this cover: Relevant Life Insurance.

A Relevant Life Policy is a form of death-in-service benefit that can be set up to pay out as a regular income, just like a personal FIB policy. However, it is paid for by your business.

The advantages are significant:

  • A Business Expense: The premiums are typically treated as an allowable business expense, so they can be offset against your company's corporation tax bill.
  • No P11D Benefit: The premiums are not considered a 'benefit in kind', so there is no extra income tax for the director to pay.
  • Tax-Efficient: This structure makes it a more cost-effective way to get cover compared to paying for a personal policy out of your post-tax income.

Specialist brokers like WeCovr can advise on whether a Relevant Life Policy is suitable for you and help you set it up correctly.

Other Protection Products to Consider Alongside FIB

Family Income Benefit is a fantastic product, but it works best as part of a wider portfolio of protection. Here are some other products to consider:

  • Income Protection: As mentioned, this is your own financial safety net. It protects your income if you're sick or injured and can't work, ensuring you can continue to pay your bills and your life insurance premiums.
  • Waiver of Premium: This is a crucial add-on for any protection policy. For a small extra cost, this waiver means the insurer will cover your monthly premiums if you are unable to work for an extended period due to illness or injury. This ensures your life cover doesn't lapse at the very moment you might need it most.
  • Gift Inter Vivos Insurance: A more specialist product for estate planning. If you gift a large sum of money or an asset to someone, it could be liable for Inheritance Tax if you pass away within 7 years. A Gift Inter Vivos policy is a type of life insurance that pays out a lump sum to cover this potential tax bill.
  • Personal Sick Pay: Often geared towards tradespeople and those in riskier occupations, this is a form of short-term income protection, typically paying out for 1 or 2 years per claim. It's designed to cover immediate loss of earnings, while a full Income Protection policy covers long-term incapacity.

Beyond the Payout: Added Value Benefits and Wellness Programmes

In today's market, insurance is about more than just a financial payout. The best insurers provide a suite of support services, available from the moment your policy begins, designed to help you and your family live healthier lives.

These 'value-added benefits' often come at no extra cost and can include:

  • 24/7 Virtual GP: Access to a GP via phone or video call, often with same-day appointments available.
  • Mental Health Support: Access to counselling sessions and mental health resources for you and your immediate family.
  • Second Medical Opinion Service: If you receive a serious diagnosis, you can have your case reviewed by a world-leading specialist to confirm the diagnosis and explore treatment options.
  • Fitness and Nutrition Programmes: Discounts on gym memberships and access to health and wellbeing apps.

At WeCovr, we believe in supporting our clients' holistic health. That's why, in addition to finding you the best policy, we provide our customers with complimentary access to CalorieHero, our AI-powered calorie and nutrition tracking app. We want to empower you to take proactive steps towards a healthier lifestyle, because your wellbeing is our priority.

Common Questions about Family Income Benefit (FAQ)

Can I have more than one life insurance policy?

Yes, absolutely. It is very common to have more than one policy to cover different needs. For example, you could have a Family Income Benefit policy to provide a monthly income for your family and a separate decreasing term life insurance policy to pay off your mortgage. A portfolio approach often provides the most comprehensive protection.

Is the income from a Family Income Benefit policy taxable?

No. Under current UK rules, the regular income paid out from a Family Income Benefit policy is not subject to income tax or capital gains tax. This makes it a very efficient way to provide for your loved ones.

Should I place my Family Income Benefit policy in trust?

Placing your policy in trust is highly recommended for most people, and it's usually free to do so when you take out the policy. A trust is a simple legal arrangement that separates the policy from your legal estate. The main benefits are that the payout can be made to your beneficiaries much faster (avoiding the lengthy probate process) and it is not typically considered part of your estate for Inheritance Tax (IHT) calculations.

Does the payout increase to keep up with the cost of living?

A standard Family Income Benefit policy provides a level income. However, you can (and should) choose an 'index-linked' or 'increasing cover' option. With this feature, the potential income amount increases each year, usually in line with inflation (RPI) or a set percentage. This ensures the money your family receives will have the same purchasing power in the future as it does today. Your premiums will also increase each year to reflect the higher level of cover.

What happens if I can't afford the premiums anymore?

If you stop paying your premiums, your policy will lapse and your cover will end. This is why adding a 'Waiver of Premium' benefit is so important. If you select this option, the insurer will pay your premiums for you if you are unable to work due to a qualifying illness or injury, ensuring your vital life cover remains in place.

Your Next Steps

Family Income Benefit is a powerful, practical, and affordable way to secure your family's financial future. By providing a replacement salary instead of a lump sum, it removes financial uncertainty and allows your loved ones to focus on what truly matters during a difficult time.

While it is perfect for young families, its flexibility and tax efficiency make it a worthy consideration for anyone with financial dependants.

Understanding which product is right for you, how much cover you need, and for how long, can be complex. Speaking to an independent protection specialist is the best way to ensure you get the right cover for your unique circumstances. At WeCovr, we compare policies from across the entire UK market to find a solution that fits your needs and your budget, giving you and your family the peace of mind you deserve.

Sources

  • Office for National Statistics (ONS): Mortality, earnings, and household statistics.
  • Financial Conduct Authority (FCA): Insurance and consumer protection guidance.
  • Association of British Insurers (ABI): Life insurance and protection market publications.
  • HMRC: Tax treatment guidance for relevant protection and benefits products.

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WeCovr is an FCA‑regulated insurance broker. We may earn a commission if you purchase a policy via us. This guide is written to be impartial and informational.

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Why life insurance and how does it work?

What is Life Insurance?

Life insurance is an insurance policy that can provide financial support for your loved ones when you or your joint policy holder passes away. It can help clear any outstanding debts, such as a mortgage, and cover your family's living and other expenses such costs of education, so your family can continue to pay bills and living expenses. In addition to life insurance, insurance providers offer related products such as income protection and critical illness, which we will touch upon below.

How does it work?

Life insurance pays out if you die. The payout can be in the form of a lump sum payment or can be paid as a replacement for a regular income. It's your decision how much cover you'd like to take based on your financial resources and how much you'd like to leave to your family to help them deal with any outstanding debts and living expenses. Your premium depends on a number of factors, including your occupation, health and other criteria.

The payout amount can change over time or can be fixed. A level term or whole of life policy offers a fixed payout. A decreasing term policy offers a payout that decreases over the term of the cover.

With critical illness policies, a payout is made if you’re diagnosed with a terminal illness with a remaining life expectancy of less than 12 months. While income protection policies ensure you can continue to meet your financial commitments if you are forced to take an extended break from work. If you can’t work because you’ve had an accident, fallen sick, or lost your job through no fault of your own, income protection insurance pays you an agreed portion of your salary each month.

Income protection is particularly helpful for people in dangerous occupations who want to be sure their mortgage will always be covered. Income protection only covers events beyond your control: you’re much less likely to be covered if you’re fired from your job or if you injure yourself deliberately.

Questions to ask yourself regarding life insurance

Just ask yourself:
👉 Who would pay your mortgage or rent if you were to pass away or fall seriously ill?
👉 Who would pay for your family’s food, clothing, study fees or lifestyle?
👉 Who would provide for the costs of your funeral or clear your debts?
👉 Who would pay for your costs if you're unable to work due to serious illness or disability?

Many families don’t realise that life, income protection and critical illness insurance is one of the most effective ways to protect their finances. A great insurance policy can cover costs, protect a family from inheriting debts and even pay off a mortgage.

Many would think that the costs for all the benefits provided by life insurance, income protection insurance or critical illness insurance are too high, but the great news is in the current market policies are actually very inexpensive.

Benefits offered by income protection, life and critical illness insurance

Life insurance, income protection and critical illness insurance are indispensable for every family because a child loses a parent every 22 minutes in the UK, while every single day tragically 60 people suffer major injuries on the UK roads. Some people become unable to work because of sickness or disability.

Life insurance cover pays out a lump sum to your family, loved ones or whomever you choose to get the money. This can be used to secure the financial future of your loved ones meaning they would not have to struggle financially in the event of your death.

If it's a critical illness cover, the payout happens sooner - upon diagnosis of a serious illness, disability or medical condition, easing the financial hardship such an event inevitably brings.

Income protection insurance can be very important for anyone who relies on a pay check to cover their living costs, but it's especially important if you’re self-employed or own a small business, where your employment and income is a bit less stable. It pays a regular income if you can't work because of sickness or disability and continues until you return to paid work or you retire.

In a world where 1 in 4 of us would struggle financially after just four weeks without work, the stark reality hits hard – a mere 7% of UK adults possess the vital shield of income protection. The urgency of safeguarding our financial well-being has never been more palpable.

Let's face it – relying on savings isn't a solution for everyone. Almost 25% of people have no savings at all, and a whopping 50% have £1,000 or less tucked away. Even more concerning, 51% of Brits – that's a huge 27 million people – wouldn't last more than one month living off their savings. That's a 10% increase from 2022.

And don't even think about state benefits being a safety net. The maximum you can expect from statutory sick pay is a mere £109.40 per week for up to 28 weeks. Not exactly a financial lifeline, right?

Now, let's tackle a common objection: "But I have critical illness insurance. I don't need income protection too." Here's the deal – the two policies apply to very different situations. In a nutshell:

  • Critical illness insurance pays a single lump sum if you're diagnosed with or undergo surgery for a specified potentially life-threatening illness. It's great for handling big one-off expenses or debts.
  • Income protection, on the other hand, pays a percentage of your salary as a regular payment if you can't work due to illness or injury. It's the superhero that tackles those relentless monthly bills.

Types of life insurance policies

Common reasons for getting a life insurance policy are to:
✅ Leave behind an amount of money to keep your family comfortable
✅ Protect the family home and pay off the mortgage in full or in part
✅ Pay for funeral costs

Starting from as little as a couple of pounds per week, you can do all that with a Life Policy.

Level Term Life Insurance
One of the simplest forms of life insurance, level term life insurance works by selecting a length of time for which you would want to be covered and then deciding how much you would like your loved ones to receive should the worst happen. Should your life insurance policy pay out to your family, it would be in a lump sum amount that can be used in whatever way the beneficiary may wish.

Decreasing Term Life Insurance
Decreasing term life insurance works in the same way as level term, except the lump sum payment amount upon death decreases with time. The common use for decreasing term life cover is to protect against mortgage repayment as the lump sum decreases along with the principal of the mortgage itself.

Increasing Term Life Insurance
Increasing term life insurance aims to pay out a cash sum growing each year if the worst happens while covered by the policy. With increasing term life cover amount insured increases annually by a fixed amount for the length of the policy. This can protect your policy's value against inflation, which could be advantageous if you’re looking to maintain your loved ones’ living standards, continue paying off your mortgage in line with its repayment schedule and cover your children’s education fees.

Whole of Life Insurance
Whereas term life insurance policies only pay out if you pass away during their term, whole of life insurance pays out to your beneficiaries whenever this should happen. The most common uses for whole life insurance are to cover the costs of a funeral or as a vehicle for your family's inheritance tax planning.

Family Income Benefit
Family income benefit is a somewhat lesser-known product in the family of life insurance products. Paying out a set amount every month of year to your beneficiaries, it is the most cost-effective way of maintaining your family's living standards to an age where you'd expect them to be able to support themselves financially. The most common use would be for a family with children who are not working yet so are unable to take care of themselves financially.

Relevant Life Insurance
Relevant Life Insurance is a tax-efficient policy for a director or single employee. A simple level term life insurance product, it is placed in a specific trust to ensure its tax efficiency. The premiums are tax deductible and any benefit payable should a claim arise is also paid out tax free, which makes it an attractive product for entrepreneurs and their businesses.

Important Fact!

There is no need to wait until the renewal of your current policy.
We can look at a more suitable option mid-term!

Why is it important to get life insurance early?

👉 Many people are very thankful that they had their life, income protection, and critical illness insurance cover in place before running into some serious issues. Critical illness and income protection insurance is as important as life insurance for protecting your family's finances.

👉 We insure our cars, houses, bicycles and even bags! Yet our life and health are the most precious things we have.

Easily one of the most important insurance purchases an individual or family can make in their lifetime, the decision to buy life, income protection, critical illness and private medical health insurance can be made much simpler with the help of experienced advisers. They are the specialists who do the searching and analysis helping people choose between various types of life insurance policies available in the market, including income protection, critical illness and other types of policies most suitable to the client's individual circumstances.

It certainly won't do any harm if you speak with one of our experienced FCA-authorised insurance partner experts who are passionate about advising people on financial matters related to life insurance and are keen to provide you with a free consultation.

You can discuss with them in detail what affordable life, income protection, critical illness or private medical health insurance plan for the necessary peace of mind they would recommend! WeCovr works with some of the best advisers in the market.

By tapping the button below, you can book a free call with them in less than 30 seconds right now:

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Any questions?

Life, income protection, and/or critical illness insurance are safety nets, very important at a difficult time. If anything happened to you before your cover ends, your life or critical illness insurance would pay a lump sum to your family and/or you (if you took a critical illness or income protection cover) to help cover the losses. Being diagnosed with a critical illness can be devastating, and it won't help matters to be also worrying about how you would cope financially. With a life, income protection, or critical illness policy, you can choose how much cover you need, how you want the policy to pay out, and whether you want cover for both you and your partner. Income protection insurance pays you a regular income if you can't work because of sickness or disability and continues until you return to paid work or you retire. Also known as permanent health insurance, it is quite important for anyone who relies on a paycheck to cover their living costs, but it's particularly important if you're self-employed or own a small business, where your income might be a bit less stable.

Life, income protection, and critical illness insurance pay out millions to families every day. Your expert will explain to you that you need to be honest and open when applying for your insurance.

If you're single with no dependants then it may be that you don't need life assurance. However, if you were to become seriously ill and unable to work, you may benefit from a critical illness or income protection policy. They can help you keep up to date with your rent, bills, food, and other expenses.

It's free to use WeCovr to find life, income protection, and critical illness insurance - we never charge you for quotes. Critical illness, income protection, and life insurance is an investment that pays many times over for you and/or your loved ones.

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The cost of life insurance depends on several factors, including your age, occupation, health status, and the level of coverage you choose. Your life insurance policy is tailored to your needs, and the cost can vary based on the sum assured, policy term, and other factors.

Some life insurance policies offer an option to add critical illness cover as a rider or as a separate policy. This provides a lump sum payment if you are diagnosed with a critical illness covered by your policy, offering financial support during a difficult time.

Yes, life insurance is available to self-employed individuals to provide financial protection for their loved ones in the event of their death. It ensures that your family can maintain their standard of living and cover expenses such as mortgage payments, bills, and education costs.

If you outlive your life insurance policy and it expires without a claim, you will not receive any payout. Term life insurance policies are designed to provide coverage for a specific period, and once that period ends, the policy terminates without any residual value. However, you can typically renew or purchase a new policy if you still need coverage.

Critical illness insurance provides a lump sum payment if you're diagnosed with a serious illness covered by your policy, offering financial support during a difficult time. It can help cover medical expenses, mortgage payments, and other financial obligations while you focus on recovery.

Critical illness insurance covers a range of serious illnesses and medical conditions specified in your policy, such as cancer, heart attack, stroke, and organ failure. The lump sum payment can be used to cover medical treatment, ongoing care, and living expenses during your recovery.

The cost of critical illness insurance varies depending on factors such as your age, health status, lifestyle, and the level of coverage you choose. Our experts can provide personalised quotes to help you find affordable coverage.

Yes, you can have critical illness insurance alongside your health insurance coverage. Critical illness insurance provides additional financial protection specifically for serious illnesses, complementing your health insurance benefits.

Critical illness insurance policies typically have exclusions for pre-existing conditions and certain medical conditions not covered by the policy. It's essential to review the terms and conditions of your policy to understand what is and isn't covered.

Some critical illness insurance policies may provide coverage for recurring illnesses, while others may not. It's crucial to review the policy terms and understand the specific conditions under which you can make additional claims for recurring illnesses. Your insurer can provide more details on their coverage for recurring critical illnesses.

Yes, you can customise your life insurance policy to suit your individual needs and circumstances. Options may include choosing the sum assured, policy term, premium payment frequency, and additional riders for enhanced coverage.

If you miss a premium payment for your life insurance policy, your coverage may lapse, and your policy could be terminated. However, many insurers offer a grace period during which you can make the payment to keep your policy active. It's essential to contact your insurer to discuss your options if you're unable to make a payment.

Yes, you can typically change the beneficiary of your life insurance policy at any time by completing a beneficiary change form provided by your insurer. It's essential to keep your beneficiary designation up to date to ensure that the proceeds are distributed according to your wishes.

Term life insurance provides cover for a fixed period, such as 10, 20 or 30 years, and pays out a lump sum if you die during that time. It’s often chosen to protect a mortgage or to provide financial support while dependants still rely on your income. Whole-of-life insurance is designed to last for the rest of your life and guarantees a payout whenever you die, as long as premiums are maintained. It’s usually more expensive than term insurance and is sometimes used to help with inheritance tax planning or to leave a guaranteed legacy.

Some term life insurance policies offer the option to convert to a whole life insurance policy without the need for a medical exam or new underwriting. This conversion feature allows you to maintain coverage beyond the term of your policy and provides lifelong protection.

Some life insurance policies offer accelerated death benefits or living benefits that allow you to access a portion of the death benefit if you are diagnosed with a terminal illness. This feature provides financial assistance to help cover medical expenses and other costs during your final months.

While having savings can provide a financial cushion during tough times, income protection insurance offers additional security by replacing a portion of your income if you're unable to work due to illness or disability. It ensures that you can maintain your standard of living and cover essential expenses even if your savings are depleted.

Yes, self-employed individuals can claim income protection insurance if they're unable to work due to illness or disability. Income protection provides a regular income stream to replace lost earnings, helping self-employed individuals cover their living expenses and business costs during periods of incapacity.

The waiting period, also known as the elimination period, is the length of time you must wait after becoming unable to work due to illness or disability before you can start receiving benefits from your income protection insurance policy. Waiting periods typically range from 30 to 90 days, but longer waiting periods may result in lower premiums.

Income protection insurance is designed to provide financial support if you're unable to work due to illness or disability, not for redundancy. However, some policies may offer optional redundancy cover or unemployment cover as an additional benefit, providing a lump sum or monthly payments if you're made redundant.

The tax treatment of income protection insurance benefits depends on whether the premiums were paid with pre-tax or after-tax dollars. Benefits from policies funded with after-tax dollars are typically tax-free, while benefits from policies funded with pre-tax dollars may be subject to income tax. It's essential to consult with a tax advisor to understand the tax implications of your income protection insurance benefits.

Income protection insurance provides a regular income stream if you're unable to work due to illness or disability, while critical illness insurance provides a lump sum payment if you're diagnosed with a covered critical illness, such as cancer, heart attack, or stroke. Critical illness insurance offers financial support to cover medical expenses, living costs, or other obligations during your recovery.

Income protection insurance policies typically have a waiting period (also known as an elimination period) during which you do not receive benefits. If you become unable to work before this waiting period ends, you will not receive any income protection benefits until the waiting period has elapsed. It's important to have sufficient savings or other financial resources to cover your expenses during this initial period.

Many income protection insurance policies allow you to increase your coverage amount if your income rises, without the need for additional underwriting or medical examinations. This feature, sometimes called a 'guaranteed insurability option,' ensures that your coverage keeps pace with your increasing income and financial obligations.

The maximum age to purchase critical illness insurance varies depending on the insurer and the specific policy. While some insurers may offer critical illness insurance up to age 70 or beyond, others may have lower age limits. It's essential to check with insurers to determine their age eligibility criteria for purchasing critical illness insurance.

Whether you can get critical illness insurance if you have pre-existing conditions depends on the insurer's underwriting guidelines and the specific medical conditions. Some insurers may offer coverage with exclusions for pre-existing conditions, while others may decline coverage altogether. It's essential to disclose any pre-existing conditions when applying for critical illness insurance and discuss your options with insurers.

While health insurance provides coverage for medical expenses, critical illness insurance offers financial protection for broader expenses associated with a serious illness, such as lost income, household bills, and lifestyle changes. Critical illness insurance complements health insurance by providing additional financial support during a challenging time, ensuring that you can focus on recovery without worrying about financial burdens.

If you don't make a claim on your critical illness insurance during the policy term, you won't receive a benefit payout. However, having critical illness insurance provides peace of mind knowing that you're financially protected if you're diagnosed with a covered critical illness during the policy term. It's a form of financial preparation for unexpected events and offers valuable protection for you and your family.

If you outlive your critical illness insurance policy and don't make a claim for a covered critical illness during the policy term, the coverage will expire, and you won't receive a benefit payout. Critical illness insurance provides financial protection for a specific period, typically until a specified age or policy term, and offers peace of mind knowing that you're prepared for the unexpected.

Yes, many insurers offer optional riders or add-ons that you can add to your critical illness insurance policy for enhanced coverage. Common riders may include waiver of premium, which waives future premium payments if you become disabled, or return of premium, which refunds a portion of your premiums if you don't make a claim during the policy term. It's essential to review available riders with insurers to customise your coverage to meet your specific needs.

To make a claim on your critical illness insurance policy, you'll need to notify your insurer of your diagnosis and submit a claim form along with any required medical documentation, such as medical reports, test results, and physician statements. Once your claim is reviewed and approved by the insurer, you'll receive the lump sum benefit payment, which you can use to cover medical expenses, living costs, or other financial needs during your recovery.

As we age, the likelihood of encountering health complications increases for us all. In the event that you develop a severe medical condition, critical illness protection can assist with the expenses of crucial bills – enabling you to concentrate on recuperation or adjusting to your new health circumstance.

The typical expense of a Critical Illness protection policy will fluctuate based on aspects such as your age and medical background. As per our investigation, you can secure a policy starting from as low as £8 (for a non-smoking 21-year-old individual).

The most prevalent critical illnesses in the UK are cancer, cardiac arrest, and cerebrovascular accident (stroke).

Cancer is one of the primary causes for critical illness insurance claims in the UK. Cancer constitutes over 80% of critical illness cover claims for females and about 45% of critical illness claims for males.

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