Life Insurance, Why It Matters More Than Ever
- Liam Drummond
- Dec 17, 2025
- 3 min read
How Many People in the Uk do you think have life insurance?
50%
25%
35%
65%
Life insurance is not something most people enjoy thinking about, but it is one of the most important parts of sensible financial planning. With higher living costs, larger mortgages, and families relying on dual incomes, the financial impact of losing a partner or parent can be devastating without the right protection in place.
Life insurance is designed to provide financial security for the people you care about most. It ensures that if the worst were to happen, your family would not also face immediate financial hardship on top of emotional loss.
The Answer: Only 35%
What is life insurance, and how does it work?
Life insurance pays out a lump sum if you pass away during the policy term. The money can be used however your loved ones need it, whether that is paying off the mortgage, covering household bills, supporting children, or maintaining a stable lifestyle.
Policies are typically set up for a fixed term, often matching the length of a mortgage or the years until children are financially independent. The right policy length and cover amount depends entirely on your circumstances.
Why life insurance is so important today
Many households are more financially stretched than they were in the past. Mortgage balances are higher, childcare costs have increased, and savings buffers are often smaller than people would like.
In many families, two incomes are needed to meet everyday costs. If one income disappears, even temporarily, it can quickly lead to serious financial pressure. Life insurance provides certainty at a time when everything else feels uncertain.
Do I need life insurance if I already have a mortgage?
In most cases, yes. A mortgage is often the largest financial commitment a household has. Life insurance can be set up to cover the outstanding mortgage balance, meaning your family could remain in the home without worrying about repayments.
Many people choose decreasing term life insurance to align with a repayment mortgage, while others prefer level term cover to provide additional financial support beyond just the mortgage.
Life insurance for families and children
If you have children, life insurance becomes even more important. Beyond housing costs, there are everyday expenses, education, childcare, and future costs that would still need to be covered.
Life insurance gives peace of mind that your children will be financially supported, even if your plans for the future cannot be carried out personally.
Is life insurance expensive?
Life insurance is often far more affordable than people expect. Premiums are based on factors such as age, health, lifestyle, and the amount of cover required. In many cases, policies cost less per month than a streaming subscription or a mobile phone contract.
Arranging cover earlier usually means lower premiums, as age and health changes over time can increase costs.
Life insurance for self-employed and complex income clients
If you are self-employed, run a limited company, or have irregular income, life insurance is just as important, if not more so. Business owners often have additional financial responsibilities, such as loans, company commitments, or dependents relying on business income.
A properly structured policy can protect both personal and business interests, and advice is essential to ensure cover is aligned with how income is generated.
What about critical illness and income protection?
Life insurance is often arranged alongside other forms of protection. Critical illness cover can provide a lump sum if you are diagnosed with a serious illness, while income protection can replace a portion of your income if you are unable to work due to illness or injury.
These policies all serve different purposes, and understanding how they work together is key to building a strong protection plan.
How professional advice makes a difference
Life insurance is not just about choosing the cheapest policy. It is about ensuring the right level of cover, the correct policy type, and terms that genuinely protect your family.
A professional adviser will take time to understand your mortgage, income, family situation, and future plans before making recommendations. This ensures your policy still makes sense years down the line, not just on day one.
Final thoughts on life insurance
Life insurance is about responsibility, planning, and peace of mind. In a world where financial pressures continue to rise, having the right protection in place is one of the most important steps you can take for your family.
If you already have cover, it is worth reviewing it regularly; if you do not, putting protection in place sooner rather than later can make a real difference.
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