Life Insurance For Over-50s: Our Best Picks

We researched the market (October 2023) with the help of our life insurance partner LifeSearch, to find out the monthly premiums for £200,000 of level term life insurance lasting 15 years for a 50-year old in good health. With level term cover the premiums and the amount of cover stays the same throughout the duration of the policy. Find more detail on our methodology, below.

We obtained life insurance quotes through Lifesearch, our life insurance partner, for a single 50-year old (insurers are not permitted to price based on gender).

We assumed that the individual was a healthy non-smoker, with no pre-existing medical conditions, and working in a low-risk job. On this basis we looked for level-term life cover for £200,000 spanning 15 years.

We then looked at the percentage of life insurance claims each provider paid out (latest data from 2022), as well its customer service score (as rated by Fairer Finance, October 2023).

With all premiums coming in at under £37 a month and not much in the way of price differential, we also weighted the results on:

• percentage of claims paid
• customer service score
• other benefits that come free with the policy.

Some policies offer a funeral pledge of at least £5,000, which bridges any gap in costs between the funeral and getting the full payout. All policies come with the option to be written in trust.

We listed only policies that cover terminal illness as standard. This means the policy will pay out on terminal illness or death – whichever happens first.

Critical illness cover, if you want this, would need to be added separately to the policy, and could increase the monthly premium considerably.

In line with industry standards, none of the life insurers provide cover for suicide for the first 12 months.

Life insurance pays out a tax-free lump sum if the policyholder dies within the term of the cover. The sum and the term are set at the outset.

In our comparison above, we looked at £200,000 of level term life cover over 15 years. That means £200,000 would be paid out if the policyholder were to die at any point within that term.

When you take out term life insurance the premiums are based on a range of risk factors, such as your age, whether or not you’re a smoker, and your state of health.

Policyholders pay a fixed monthly premium for the cover which lasts for a fixed term, such as 20 years, for example.

Often life cover is taken out alongside a mortgage, so that the home loan debt can be cleared in the event of the policyholder’s death.

A policy might also be timed to coincide when dependent children could be expected to have reached an age where they are financially independent.

There are many different types of life insurance including level term cover, decreasing term cover, joint policies and life insurance that is combined with critical illness cover, for example.

There is also a specific type of life insurance policy aimed at the over-50s, which is typically called over-50s life insurance or a funeral expenses plan (there is more on this specific type of policy in the section on alternatives below). It works in a different way to term life cover, and usually pays out a much smaller sum on death.

According to a Forbes Advisor survey 11% of Brits hold this type of over-50s life insurance policy.

The premiums for term life insurance are calculated based on your age, state of health and your occupation, as well as the sum you want to insure and the term (length) of the policy, among other factors.

For those aged 50 or over, the premiums can be relatively high compared to younger policyholders, even if you have no pre-existing medical conditions and are in good health. This is just because age is one of the main risk factors for insurers when pricing life cover.

Policyholders then pay the monthly premium for the cover for the duration of the term. If you die during the policy term your beneficiaries receive a tax-free lump sum payout.

How much you’ll have to pay for term life insurance will depend on a range of factors including your age, your state of health and whether or not you’re a smoker or vaper.

Age is one of the main factors for life insurance pricing – as clearly the risks of a claim on life cover increase as you age. If you’re on a tight budget you could insure a smaller sum or opt for cover over a shorter term to bring down the monthly premium, although this means you’re taking on more of the risk.

It is possible to take out life insurance after the age of 50. But it’s important to note that one of the main factors for life cover pricing is age. That’s why it makes sense to take out cover as early as possible – because the premiums will be cheaper. So, while you can buy cover in your 50s and later, you should expect to pay more.

There is no fixed or blanket maximum age limit for life insurance in the UK. Different insurers will have their own limits for a new life insurance policy, this could range from 60 up to 85, for example.

It may also depend on the type of life insurance cover you want and how much you want to insure. However, it is likely to be very expensive to get term life insurance in later life.

As mentioned above this will depend on the sum you want to insure and over what duration or term. The larger the payout you need, the higher the premium you’ll pay.

Risk factors, such as age, your state of health and lifestyle, plus any pre-existing medical conditions, can also bump up the overall cost.

A great way to find competitive premium quotes is to shop around. As part of our research into this market we obtained life insurance quotes through Lifesearch, our life insurance partner, for a single 50-year old in good health and a non-smoker. We found policies for level term cover of £200,000 starting from around £26 per month, for example (see table above for examples).

It will usually still be possible to get term life insurance over 50 with a pre-existing condition, but it might depend on what it is and the severity. Pre-existing conditions will typically push up the cost of life cover.

If you have health conditions it might be worthwhile speaking to an independent and specialist life insurance broker who can help search the market for policies to suit your needs.

An alternative to term life insurance for the over-50s is a special form of cover designed for older people called, variously, over 50s life insurance or a funeral expenses plan.

You can take out one of these plans if you’re aged between 50 and 80. You pay fixed premiums for life and receive a guaranteed payout on death, which can help loved ones pay for funeral costs, for example.

Over 50s life cover tends to be a smaller sum and as a result the premiums are typically lower than for term insurance.

You’re guaranteed to be accepted for cover with no medical necessary, even if you have underlying health issues.

However, the downsides are that, if you live for a long time, you could end up paying in considerably more than your family will get back when the policy pays out on your death, plus there is no option to cash-in the policy. If you decide to stop paying the premiums, the cover ends and there is no refund.

In round numbers, say you had a funeral plan with a £5,000 sum assured and a £25 month premium, you would have paid in £5,000 after less than 17 years if you survived that long.