Whole of Life Insurance


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By Crispin Bateman

Updated on Wednesday 12 February 2020


Life insurance is available for many things – covering mortgages and the loss of salary due to illness or injury in our working years, providing for the children while they are still dependants, or covering periods of critical ill health.

There are a few different types of life insurance available to suit a variety of needs and requirements, including term life cover, critical illness insurance, and of course, whole of life insurance.

flower on grave

What is whole of life insurance?

Whole of life (WoL) insurance is the most simple type of life insurance to understand.

You pay for it every month from the beginning of the policy until you die and it is guaranteed to pay out upon your death, whether that happens at the start of the term or a century later. As the name suggests, there is no expiry date and – as long as you keep up with your monthly premiums – it will pay out an agreed lump-sum.

As whole of life cover is definitely going to pay out when you pass away, and as (unfortunately) your death is a guaranteed event, the insurance companies know that eventually, the policy will have to pay out. Consequently, premiums are somewhat higher than other insurance policies to cover the guaranteed pay-out.

Ultimately, whole of life insurance is the perfect type of cover to protect your family from the additional hardship of covering unexpected funeral costs, and it also provides them with financial support as they begin to come to terms with not having you around.

Depending on the amount of cover you take out, the pay-out could also help your loved ones deal with expenses such as mortgage payments and inheritance tax, as well as the cost of your funeral.

By having a good whole of life insurance policy in place, your family can grieve in peace without having to worry about any financial issues.

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What is the average cost of whole life insurance?

The cost of whole of life cover varies between each individual and the monthly premiums are calculated based on many different factors relating to the policyholder.

As a rule of thumb: the higher risk you pose to insurers, the higher your premiums are likely to be.

If you are a smoker, for example, it’s likely that you will face higher premiums than the equivalent non-smoker, due to the health implications that smoking can cause.

Note: Life insurance for smokers is, on average, 50% more expensive than it is for the equivalent non-smoker.

Whole of life insurance is typically more expensive than other types of cover, because the insurers know that they will be required to pay out at some point.

The cost of life insurance is calculated using:

  • Age
  • Health and medical history or conditions
  • Whether the policyholder smokes or not
  • Alcohol consumption
  • Extreme sports participation
  • Occupation
  • Level of cover and the sum insured

Generally speaking, the fitter and younger you are, the cheaper your life insurance will be. Premiums start from as little as around £5 a month for some, depending on the provider and level of cover chosen, and there are many things you can do to reduce the cost.

To get cheap life insurance, you can:

  • Get healthier
  • Link your policy to an activity tracker
  • Choose a lower level of cover (don’t over-insure yourself)
  • Get decreasing cover
  • Quit smoking
  • Avoid doing extreme sports
  • Take out a policy as early as possible
  • Cut out unnecessary optional extras
  • Consider writing your policy in trust (for tax purposes)

Is whole of life insurance worth it?

The main reason people take out whole of life insurance is because it gives you the peace of mind in the knowledge that your loved ones will be financially secure when you pass away.  

Some of the other benefits of whole of life insurance include:

  • You’re insured for the rest of your life
  • Your loved ones are guaranteed a pay-out
  • The pay-out is tax-free
  • It can help cover inheritance tax bills
  • Premiums are cheap if you take out a policy early enough
  • Premiums and pay-outs are usually fixed

To determine whether whole of life insurance is worth purchasing, weigh up the cost of the premiums against the lump-sum pay-out provided in the event of your death (and keep in mind that it is guaranteed, regardless of when you die).

Get a cheap life insurance quote today from Confused.com – it only takes around three minutes!

Over 50s life insurance

A standard whole of life policy, like most types of life insurance, will be subject to a number of terms depending on the insurerand the price of premiums will depend on your own current situation, including your health and age, as mentioned.

It’s something that can put a lot of people off life insurance – especially if they either currently have, or have recently suffered a serious illness or injury. All too often, people assume that they will be refused life cover due to their medical circumstances and don’t even get to the first stage of protecting their loved ones.

Over 50s cover is designed to give whole of life-style cover for those over the age of 50 with existing medical conditions – without putting them through a long, and sometimes upsetting, medical or health check.

As long as you are over fifty years old , you are guaranteed to be eligible for over 50s life insurance!

One of the main differences between WoL and over 50s cover is that it provides the perfect answer to funeral expenses for those who may be declined the standard whole of life insurance due to old-age or any medical conditions. Other differences include:

  • You must be over 50 years old to qualify for over 50s cover.
  • Over 50s premiums are generally slightly higher than traditional whole of life cover.
  • There’s a two year deferment with over 50s life insurance*.
  • You only pay premiums until you reach 90 years old, but your cover remains in place.

*The two-year deferment means that should you die in the first two years; the policy will not pay out the full cover. Your money is not lost though, as it will pay 150% of the amount you have paid so far in premiums.

If, during the first two years, death occurs through an accident, the policy will pay three times the normal payout amount (double check these terms with your policy). Covering the cost of a funeral

According to recent research done by SunLife, the average cost of a funeral in the UK is £4,417, with the average cost of a burial being £4,975 and a cremation being £3,858.

Read more: The Average Cost of a Funeral in the UK

For many, those numbers are such a heavy weight added on to the sheer grief of having lost a loved one. Some families stumble unwittingly into debt, while others have to accept the loss of the funeral ceremony itself and go for the most basic direct cremation.

Keeping cover

Remember that life insurance policies only remain in force should you keep up with your regular premium payments – something that is especially important regarding whole of life policies. A new policy can be put in place should a lapse of payments occur, but the premiums are usually greater on policies taken out when you are older.

Get your whole of life insurance quote

Getting your whole of life insurance quote is now quick and easy, thanks to Confused.com, who are able to compare over 50 providers and offer you a price within just three minutes!

Tap the button below to get your cheap life insurance quote today!

For more free advice on life insurance, whole of life cover and over 50s policies, browse our range of insurance articles right here at Compare UK Quotes.


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