You’ve finished your studies or you are already working? Now you need to think about getting a life insurance. What kind of life insurance should you choose? What are the best life insurance for young people? There are so many things to consider.
If you’re looking for the answers, you’ve come to the right place!
In this guide, we will explain everything you need to know about life insurance for a a young adult: which cover you should get, what life insurance terms you should pay attention to, etc.
Table of Contents
Is life insurance necessary for young adults?
First of all, you should consider taking out life insurance for your family because it is the best way to protect your loved ones if something happens to you.
Secondly, it’s simply for peace of mind. Needing to take care of all financial matters during a period of grief is not an ideal situation. Taking out life insurance would take the weight off your shoulders. For example, if you took out a student loan, life insurance can protect your relatives if you passed away.
There is no “young people life insurance” as a policy; it is more a combination of elements in your policy that can give financial protection to you and therefore for your loved-ones.
You will have to consider these points when taking out life insurance:
- Choosing you coverage: term life insurance or whole life? Single life or joint life?
- If you are taking a term life: for how long?
- Will you include add-ons such as critical illness in life insurance for young people?
What are the different types of life insurance for young people?
When choosing life insurance for young people, you have to make a lot of important choices. You have to choose between different policy types to find what would best cover your needs. As the first big choice, you have to choose between:
- Term life insurance. Term insurance splits into two types: level term or decreasing insurance. If you choose a term insurance, once again you would have to choose between these two.
- Whole of life insurance. This insurance will pay out when the policyholders die.
|Term life and whole life insurance||Details||Reviews|
Cheaper than whole life insurance. Good alternative for young adults.
|Term decreasing – also known as mortgage insurance|
If you took out a loan to buy a house, for example, it is a good policy to have.
|Whole life insurance |
Really protective insurance but not adapted to small budget
Should you take out single or joint life insurance for young people?
If you are in relationship, you can also choose between having a joint policy or single policy:
|Types of insurance||Details||Reviews|
|Joint policy||Cheaper than taking two single policies. |
Not really protective, as when one passes away, the other is no longer insured and will have to take out a single policy that will be at higher cost as they are now older.
|Single policy||Taking out two policies is more expensive. |
You can choose the level you want, beneficial if the two partners don’t need to be insured at the same level.
Much more protective than a joint policy because you are sure to have two pay-outs, and you are protected in case of a break-up.
What could you add to your young people life insurance?
Choosing life insurance for young people is not an easy thing to do, because you must consider all the add-ons that you can put in your policy in order to be best protected:
|Critical illness as an add-on|
Can really protect your loved ones in case of illness.
|Policy in trust||Your family, relatives, partner won’t have to pay for taxes when receiving the sum.|
Really protects your parents or relatives, by indexing your life insurance as they are sure to get the same benefit a few years later.
Critical illness combined with life insurance will pay just once. But critical illness as an add-on will pay for your illness and death.
Finally compare best life insurance in a few seconds, anonymously.
How much will your Young Adult life insurance cost?
The big question is knowing how much life insurance you need. Your answer to this question will determine the price of your life insurance.
How much your life insurance for young people is will depend on several factors:
- Your age
- Your medical conditions
- Whether or not you are a smoker
- Which add-ons you add to your family life insurance
- Your salary
- The coverage you want
- Whether you take out a joint policy or not
So you must ask yourself the relevant questions for your own situation, for example: Do you have a loan? Do you have savings? Do you have debts? Do you have a family? Does your job offer protection?
A 30-year-old in good medical condition will pay less than a 45-year-old smoker who’s in bad medical condition.
Life insurance for young people is less expensive, for example.
|Age group||Joint life insurance (monthly premium)||Single life insurance (monthly premium)|
How much will my young people life insurance cost if I add critical illness insurance?
In this table, we can see how much it costs to have critical illness cover with either joint life insurance or single life insurance.
|Age group||Critical illness add-on to life insurance with a joint life insurance |
|Monthly cost of single life insurance with critical illness cover |
|More than 60 years old||£528.06||£333.10|
Average level term insurance (10 years to 20 years): additional critical illness
What are the best Young Adult life insurance quotes?
You can either choose term insurance or whole life insurance. We have put together a list of the best life insurance quotes and their features.
What are the best term insurance quotes with critical illness?
|Best term insurance (single policy)||Details||Reviews||Monthly premium (including critical illness as add-on)|
|Vitality life insurance: ||5/5 Defaqto rating|
|Royal London term insurance:||2/5 Defaqto rating|
|AIG term insurance: ||5/5 defaqto||Level: £9.24|
|Legal & General term insurance: ||4/5 Defaqto rating|
|Aegon term insurance: ||4/5 Defaqto rating|
|Zurich term insurance: ||3/5 Defaqto rating|
|LV term insurance: ||3/5 Defaqto rating|
|Aviva term insurance: ||3/5/Defaqto rating|
Cover £150,000 –- 30 years old – non-smoker
What are the best whole young people life insurance quotes?
|Best whole life insurance – single policy||Details||Pros and cons||Monthly premium (including critical illness as add-on)|
|Possibility to add options that lower the monthly premium||£98.63|
|Free cover before the policy starts||£90|
|Possible to adjust policy during the life of the policy||£148|
No possibility to adjust policy during the term|
Accidental death benefit included
Waiver of premium
Waiver of premium ||£83.65|
|Possibility to adjust policy during the life of the policy||£90|
|You can adjust your policy during the term.||£96.03|
Cover £150,000 –- 30 years old – non-smoker
Can I take out life insurance for my parents?
Yes, you can decide to take out whole life insurance for your parents. This can help with paying funeral costs and outstanding bills, etc. Of course, you will need their agreement. You can have a look at our article on this subject, about over 50s life insurance.
How do I cancel my young people life insurance?
You can cancel your life insurance, but it means that you and your family won’t be protected anymore. Keep in mind that if you want to take out your insurance again, it will be much higher. If you want to stop paying premiums for a while, this doesn’t make economical sense, because the younger you take out your life insurance, the cheaper it is.
Sometimes, it happens that you want to cancel your policy because your situation has changed and you no longer need this type of insurance. For example, maybe you've finally managed to pay off the loan on your house.
- You have 30 days to cancel your life insurance without any charges.
- After these 30 days, you must write to the insurer to announce that you wish to cancel your life insurance. Usually there is no extra charge to cancel a life insurance policy, but you won't be refunded your premium.
How do I make a life insurance claim?
Here are the few steps to make a life insurance claim. Usually, it doesn’t take weeks; it is more a matter of days:
- Contact life insurance company: explain to the life insurance company that you are making a claim.
- A few documents are important in order to make the claim, in particular the death certificate.
You must fill out all documents and forms.
Then you will receive the pay-out. Depending on the circumstances, it can arrive quite fast.
It is better to write your policy in trust because the insurer will pay the nominee on the policy directly, and the pay-out won't be taxed by the estate tax.
Can I update my life insurance?
Yes, some insurers leave you this choice to take a higher policy premium if you have change in your life: starting a family or expanding your family. Your monthly premium will be higher too.
How do I get a young people life insurance quote?
Applying for family life insurance can be a long process. You need to know exactly:
- How much cover you would need. Verify if you already have protection through your job, for example, and calculate the right amount.
- How long you want the cover for.
Find out what the best life insurance for your family is with our 100% anonymous tool.
What are the alternatives to young people life insurance?
There are alternatives to life insurance. However, these options are more a way to complement a less expensive life insurance plan than to replace family life insurance completely:
- Income protection: An income protection policy is an insurance plan that covers you if you are unable to work due to illness, injury or unemployment. It is designed to pay part of your lost earnings.
- Death in service benefits: This is a lump sum payment given by your employer. If your employer offers this kind of benefit, it means that they will pay a cash sum when you die. Of course, you must still work for the company to benefit from this insurance. Take a look at the terms and conditions written.
- Family income benefits: You don’t receive a lump sum but instead get a monthly payment during the term.