The six best UK life insurance providers of 2024

Life Insurance
Life Insurance

If you have people who rely on you financially, then you should probably consider purchasing a life insurance policy.

Life cover can give you the peace of mind that, should the worst happen to you, your loved ones would not struggle for money.

This is particularly important if you have a mortgage or children. However, it can be hard to know which type of cover to purchase, and which company to entrust your money to. After all, you do not want to pay thousands over the years for a policy that fails to pay out when you need it most.

This guide will help you work out which type of cover is right for you, and introduce you to some of the best-known companies selling life insurance in the UK.

Types of life insurance

The type of life cover that works for you will depend on your circumstances, but broadly speaking there are three main types of coverage:

  • Term insurance

  • Whole-of-life insurance

  • Family income benefit insurance

Term life insurance will cover you for a set period of time, for example 25 or 30 years. This can be helpful if you have taken on a significant amount of debt, most commonly a mortgage. Once the term ends, you will no longer be covered. The payout can either increase or reduce over time.

As the name suggests, whole-of-life insurance covers you for just that – your whole life – and will pay out to your family when you die. It avoids the hassle of renewing your cover each time the term expires, but it is usually more expensive than insurance with a fixed term.

While the above two options usually pay out a lump sum, family income cover aims to replicate the income lost if you were to die. It usually pays out monthly and could be particularly appropriate if you are the main or sole breadwinner.

Within these categories, there are also several subcategories that may suit your needs. Ask your provider for more details.

Choosing the right life insurance provider

When choosing providers, there are several things you can do to ensure the cover is right for you. Customer reviews may be helpful.

Consumer groups such as Which? and Fairer Finance have detailed guides and ratings which can help you decide if a particular company is one you can trust.

In the next section of this guide we will provide some detail on some of the biggest providers in the UK, referencing the Fairer Finance rankings, listed in alphabetical order.

Fairer Finance says that it developed its rankings to make it easier for consumers to select cover based on customer experience and not simply price.

In life insurance, the group assesses what percentage of claims are paid, how well companies deal with complaints and how transparent a company is. It then averages out those scores to give an overall ranking.

Providers publish their own claims data, while complaints data is taken from the Financial Ombudsman Service (FOS). Fairer Finance analyses transparency based on its assessment of the purchase journey and the company’s terms and conditions.

The group awards a gold ribbon to firms which outperform 80pc of the market, a silver ribbon to those that beat 70pc of the market and a bronze to those that beat 60pc.

Top life insurance providers in the UK

AIG Life

AIG is one of the biggest providers in Britain and sells a large range of products. However, it may not be a name you recognise as it does not sell directly to consumers, but via financial advisers.

Despite its size, it does not currently have a ribbon from Fairer Finance, meaning it is not outperforming at least 60pc of the market.

Although it received a high score for paying out claims (86pc) and handling complaints (85pc), it was hampered by a low score of 56pc for transparency. This made for an overall score of 75pc – just short of the level needed to gain a bronze ribbon.


Readers with a slightly longer memory might remember Aviva as Norwich Union. It rebranded in 2002, but remains headquartered in Norfolk and has grown to become one of the largest providers of cover in the UK.

While traditionally its products were not listed on price comparison websites, in 2021 it changed this policy meaning you can now compare premiums from Aviva alongside its competitors at one glance.

It has a Fairer Finance gold ribbon with an overall score of 82pc. Despite a slightly below par transparency score of 67pc, it pays out 91pc of claims and netted a score of 90pc for handling complaints.


As one of the largest consumer banks in the UK, HSBC is one of the most recognisable names in financial services. Many readers may hold a current account with the provider, but it offers many different types of life insurance, too.

However, its score on the Fairer Finance rankings leaves much to be desired, failing to earn itself a ribbon with an overall mark of 72pc.

It pays out on 89pc of claims and scored 83pc for complaints, but had one of the lowest ratings for transparency out of any of the providers Fairer Finance analysed – just 46pc.

Legal & General

Legal & General is the largest provider of term life insurance in the UK, according to consumer group Which?.

It provides several levels of cover as well as a £10,000 funeral pledge, making immediate payment to this amount as soon as your claim is accepted.

Fairer Finance rated it at 75pc overall, meaning it does not earn a coveted ribbon. Fairer Finance says it paid out on 71pc of claims (although Which? research said this figure was more than 96pc in 2022) and rated at 71pc for transparency. It had a fairly high score for complaints of 84pc.

Royal London

Another huge insurer, Royal London, offers most types of life insurance, including term cover with the option to add critical illness cover and income protection.

Its overall score of 80pc earns it a Fairer Finance silver ribbon. According to the group’s ratings, it pays out on 80pc of claims, has an 81pc score for dealing with complaints and a 75pc rating for transparency.


Vitality, the brand name of Prudential, is well known for its innovative and flexible life insurance. It offers incentives in the form of discounts to those who make healthy lifestyle choices. The level of this offered discount changes depending on how fit and active customers are.

It has a Fairer Finance bronze ribbon, with an overall score of 77pc, but has one of the highest scores for approving claims with 97pc. It has a 78pc ranking for handling complaints and a 58pc score for transparency.

Other high-scoring providers

The Fairer Finance rankings are topped by two firms you may not have heard of. Beagle Street and Smart Insurance both earn a gold ribbon with the highest scores of all the companies analysed: 85pc. Both pay out on 94pc of claims. The other company to get a gold ribbon is the Post Office with a score of 82pc.

Silver ribbons were awarded to Virgin Money and Budget, while Churchill, Santander, Direct Line, Co-operative Insurance and NFU Mutual all won a bronze ribbon.

Fairer Finance updates its ratings every six months. They are available to view here.

Factors affecting life insurance costs

As with premiums across the industry, life insurers will use a number of personal factors to determine premiums, including:

  • Age

  • Pre-existing health conditions

  • Coverage limits (e.g., the size of payout)

  • Additional add-ons (for example, critical illness cover or income protection)

  • Family medical history

  • Weight

  • Smoking

  • Alcohol consumption

  • Hobbies

Ultimately, insurers assess premiums based on the risk that they may need to pay out on a policy. Someone with an unhealthy lifestyle may be more likely to need to make a claim, which is why insurers want to know things such as how much you weigh, how often you drink alcohol or whether you smoke.

The same goes for your health information, as someone with a pre-existing condition could be more likely to make a claim, and most insurers will want to see your medical records.

Likewise, firms will want to know if you have any dangerous hobbies, such as skiing, paragliding or mountaineering, for the same reason.

Benefits of purchasing life insurance

There are several benefits of having a life insurance policy, including:

  • Peace of mind

  • Replacing lost income

  • Paying off debts, such as a mortgage

  • Inheritance tax benefits

  • Cover funeral expenses

The main benefit of life insurance is peace of mind. If a tragedy were to occur and you were to die, then you would be comfortable knowing that your family will be provided for.

If you have an outstanding mortgage, for example, then a life insurance payout could pay off that debt. Or if you are the main breadwinner in the family then an income benefit policy could replace your income if you died.

There could also be inheritance tax (IHT) advantages to taking out a life insurance policy. A payout could be used to pay IHT obligations – which would otherwise have to be covered by family or by selling property.

A policy can also be “written in trust”, which would take the payout outside of your estate for IHT purposes, potentially leading to a significant tax saving.

Best life insurance for over-50s

Those over the age of 50 could find it harder to purchase a regular life insurance policy. Many firms will accept an older person, but the offered premium could be much more expensive.

Specialist over-50s policies offer guaranteed acceptance and a guaranteed pay out when you die, as long as a mandatory minimum period has been exceeded. Monthly premiums are also fixed.

The downside is that this type of policy will usually offer lower payouts and, if you were to live a long time, you could end up paying in more than you receive.

There could be alternative strategies available. For example, if you were concerned about your family’s ability to pay for your funeral, you could put aside the money you would have spent on premiums into a savings account each month for this purpose.

Factors to consider when calculating coverage

When deciding how much cover you will need from a life insurance policy there are a range of different factors to consider. These include:

  • Dependents (marital status and children)

  • Mortgages and other debts

  • Inheritance tax

  • Income

The main purpose of life insurance is to help you make sure that your dependents are financially secure if you die, so you need to consider how much they would need to get by. If your partner is a low earner, or does not earn at all, then you may need to get a larger policy to replace your lost income.

Similarly, if you have a mortgage then it would be sensible to have cover that would at least pay off the debt should you die.

As explained above, if your estate is likely to be liable for IHT, then this should be a consideration. The threshold for paying IHT starts at £325,000, although with other allowances this can increase to half a million.

If your estate is likely to fall into this bracket, then you could consider writing a life insurance policy into trust for the amount that would bring you below the threshold, meaning your bequeathal would be free from tax.

Comparing quotes from different life insurers

It is important to get quotes from several different insurers to make sure you are getting the correct price. This can be done by using a price comparison website, however, for the most accurate quotes you will need to provide insurers with your medical records and personal details.

It is a good idea to approach at least three different companies to make sure you are getting a fair price.