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How to Understand UK Life Insurance Statistics: Make Smarter Cover Choices with Insurance Hero in 2025
In 2025, the most useful UK life insurance stats answer three things fast: who has cover, what gets paid, and what claims succeed. Right now, 28% of UK adults hold life insurance and insurers paid £8.0bn in protection claims during 2024.
Opening hook: UK insurers paid the equivalent of £21.9 million every day in 2024 protection claims, according to ABI & GRiD.
Data sources include the FCA Financial Lives Survey (published 2024) and ABI protection claims reporting (published 2025).
Executive summary: the stats people actually use
- Coverage: 28% of UK adults report holding a life insurance policy in 2024. That means 72% do not. (FCA Financial Lives)
- Payouts: Insurers paid a record £8.0bn across individual + group protection claims in 2024, or £21.9m per day. (ABI & GRiD)
- Claim success: The proportion of new individual claims paid stays at or above 97.9% over the last decade. (ABI)
- Affordability: UK consumers often overestimate costs by 184% (£79.50 expected vs £27.95 average L&G policy cost in 2024). (L&G via Actuarial Post)
Sources: FCA Financial Lives Survey 2024 protection findings; ABI 2024 protection claims release (published July 2025); L&G pricing perception reporting. :contentReference[oaicite:0]{index=0}
Table of contents
- 1What are the headline UK life insurance stats in 2025?
- 2How many UK adults have life insurance right now?
- 3How much do UK insurers pay out, and how often are claims accepted?
- 4Which claim types pay the most, and what causes claims?
- 5Are more people buying cover in 2024–2025?
- 6What does life insurance cost in the UK in 2025?
- 7Why do people delay buying life insurance?
- 8How do complaints and disputes look for insurance?
- 9What can you do with these stats when choosing cover?
- 10What trends should you watch in 2025–2026?
- FAQQuick answers (schema-ready)
- ↗Sources and citations
1) What are the headline UK life insurance stats in 2025?
If you only remember five numbers, remember these. 28% of UK adults say they hold a life insurance policy. Insurers paid £8.0bn in protection claims during 2024. That equals £21.9m per day. New claims are paid at very high rates, staying at or above 97.9% for the last decade. And for term life claims, the average payout is about £79,703.
Here’s why this matters. These stats give you a reality check. They show most people still don’t have cover. They also show claims usually pay out when policies are set up correctly. According to the ABI, common decline reasons include non-disclosure and not meeting policy definitions.
2) How many UK adults have life insurance right now?
The cleanest “ownership” number comes from the FCA Financial Lives Survey. It reports 28% of all UK adults held a life insurance policy in 2024. That makes life insurance the most commonly held protection policy in that dataset.
The detail is just as useful as the headline. For example, FCA data shows 57% of mortgage holders report having life insurance. That’s a big difference from the overall population. It also tells you how life insurance is often tied to major debts, especially mortgages.
Insurance Hero tip: if you’re buying a home, you’re already in the “most likely to need cover” group. If you rent, the need can still be real, but it’s usually driven by dependants and income.
| Group | Life insurance holding | What it suggests |
|---|---|---|
| All UK adults (2024) | 28% | Most people are still uninsured |
| Mortgage holders (2024) | 57% | Cover is strongly linked to debt protection |
| Any protection insurance (2024) | 46% | Many have something, fewer have life cover |
FCA Financial Lives Survey 2024, protection findings. :contentReference[oaicite:3]{index=3}
3) How much do UK insurers pay out, and how often are claims accepted?
The ABI’s latest claims release is blunt in the best way. Insurers paid a record £8.0bn in combined group and individual protection claims in 2024. For individual protection (life, critical illness, income protection), payouts total £5.32bn. Meanwhile, new individual claims paid remains high, and the ABI reports a decade-long trend of 97.9% or above.
You can also zoom into life insurance specifically. In 2024, ABI reporting shows term life new claims paid at 96.5%. Total term life value paid is £4.025bn. The average term life claim sits around £79,703. That average gives you a sanity check when you’re choosing your sum assured.
Quick comparison table: claim success by product (2024)
| Product | New claims paid | % of new claims paid | Average value of claims paid |
|---|---|---|---|
| Term life | 50,499 | 96.5% | £79,703 |
| Critical illness | 20,990 | 89.7% | £68,735 |
| Whole of life | 206,839 | 99.99% | £7,408 |
ABI protection claims reporting (published July 2025). :contentReference[oaicite:5]{index=5}
4) Which claim types pay the most, and what causes claims?
Statistics become useful when they help you picture real scenarios. ABI data shows critical illness is a high-value claim category. In 2024, the total value of critical illness claims reached £1.3bn. The average critical illness claim is about £67,600. Cancer remains the most common reason, making up 62% of critical illness claims. Total cancer payouts reached £812m.
For income protection, ABI reports total payouts of £204m in 2024. The average income protection payout is around £10,000. Musculoskeletal issues lead the volume of claims at 34%. ABI also notes at least £32m in payouts linked to these issues, even though not every case records a reason.
5) Are more people buying cover in 2024–2025?
One of the clearest “fresh” indicators is FCA Product Sales Data for pure protection contracts. In Q4 2024, firms reported 252,570 pure protection sales. In Q4 2023, it was 219,419. That is roughly a 15.1% rise year-on-year. It suggests demand picked up through late 2024.
Now check the most recent quarter in the same series. In Q1 2025, pure protection sales were 234,783. In Q1 2024, sales were 242,418. That’s around a 3.1% fall year-on-year. So the picture is mixed: a strong Q4, then a softer Q1.
Premium totals move too. FCA reports total premium amounts of £106.3m for pure protection in Q4 2024 and £111.4m in Q1 2025 (annualised where relevant). Treat this as a market signal, not your personal price.
| Quarter | No. of sales | Total premium amount |
|---|---|---|
| 2024 Q4 | 252,570 | £106,318,408 |
| 2025 Q1 | 234,783 | £111,430,935 |
FCA FOI release of Product Sales Data (published May 2025). :contentReference[oaicite:7]{index=7}
6) What does life insurance cost in the UK in 2025?
People usually ask this as: “What’s the average monthly premium?” Compare the Market states an average of £17.07 per month, based on certain assumptions, and references September 2025. It also says 51% of its customers were quoted less than that figure for a 10-year term up to £175k cover (no critical illness), in the same period.
Legal & General provides another real-world reference point. Its site says the average cost of Life Insurance is £27.95 per month using its 2024 figures. Both figures can be “true” because averages depend on age, cover amount, term length, smoker status, and extras.
| Source | Average stated | Timeframe / basis |
|---|---|---|
| Compare the Market | £17.07/month | Based on its customer quote data (September 2025 assumptions) |
| Legal & General | £27.95/month | L&G 2024 average life insurance cost statement |
Sources: Compare the Market life insurance calculator; Legal & General life insurance calculator page. :contentReference[oaicite:8]{index=8}
7) Why do people delay buying life insurance?
The most common blocker is cost — or rather, what people think it costs. A Legal & General study reported people estimate life insurance at £79.50 per month, which is 184% higher than the reported £27.95 average L&G policy cost in 2024. It also reports 27% of respondents say life insurance is “too expensive.”
The same reporting says 6.5 million UK adults are postponing financial products like life insurance until they reach “life milestones.” That sounds sensible, but it’s risky. Milestones like buying a home or starting a family can happen later. Meanwhile, your health can change sooner than you expect.
James Shattock, Managing Director UK Protection, says there’s a “significant perception gap” and that starting early can mean “lower premiums and stronger protection.” :contentReference[oaicite:9]{index=9}
8) How do complaints and disputes look for insurance?
Complaints stats don’t tell you “life insurance is bad.” They tell you what consumers challenge, and how the dispute system is coping. In the second half of 2024 (July–December), the Financial Ombudsman Service reports 22,075 new complaints in the general insurance/pure protection category. That compares with 22,845 in the same period of 2023. So, volumes look broadly stable for that category.
What’s changing is the overall system load. The Financial Ombudsman Service received 141,846 complaints across all products in July–December 2024, and says overall uphold rate was 33% for that half-year. These system-wide shifts can affect resolution times, even if your product area stays flat.
Source: Financial Ombudsman Service H2 2024 complaints press release (published May 2025). :contentReference[oaicite:11]{index=11}
9) What can you do with these stats when choosing cover?
Stats are only helpful if they change your next decision. Start with ownership: if only 28% of adults have life insurance, you’re not “weird” for being uninsured. You’re normal. But “normal” doesn’t mean “safe.” Next, look at payouts: £4.025bn paid in term life claims (ABI) shows life cover is used in real life, at scale.
Finally, focus on claim success. A term life new-claim pay rate of 96.5% strongly suggests the basics matter: honest disclosure, correct policy type, and sensible sums insured. That’s exactly where Insurance Hero helps, because we compare across insurers and match cover to your situation.
“Most claim problems come from avoidable paperwork issues — not because insurers ‘don’t pay’.” — Steve Case, Principal Consultant, Insurance Hero.
Implementation guide: a simple 7-step process (with timelines)
-
1Today (10 minutes): List your “must-cover” costs (mortgage balance, rent, debts, childcare). Use ABI’s £79,703 average term life claim as a reality check. :contentReference[oaicite:12]{index=12}
-
2Today (5 minutes): Decide the policy goal: mortgage-only (decreasing term) vs income replacement (level term).
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3This week: Gather disclosure info (GP conditions, meds, smoking status). ABI notes non-disclosure is a common decline reason. :contentReference[oaicite:13]{index=13}
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4This week: Compare quotes from multiple insurers (Insurance Hero does this for you). Use “average cost” stats (£17.07 or £27.95) only as a budget range. :contentReference[oaicite:14]{index=14}
-
5Within 7 days: Choose beneficiary plan (and consider writing in trust if appropriate for your situation).
-
6Within 14 days: Confirm policy schedule and keep documents in a shared folder. This helps beneficiaries claim faster.
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7Every 12 months: Re-check cover after life changes (new child, new mortgage, pay rise). FCA data shows mortgage holders behave differently, so changes matter. :contentReference[oaicite:15]{index=15}
10) What trends should you watch in 2025–2026?
Three signals matter going into 2026. First is engagement. If only 28% of adults have life cover, the “protection gap” is still huge. Second is affordability messaging. The 184% perception gap reported around pricing is exactly the kind of problem that drives late buying. Third is market scrutiny. The FCA’s pure protection distribution market study states it planned to publish analysis during 2025. That can shape how products are sold and explained.
Expect more focus on plain-English explanations. The ABI also reports common decline reasons include non-disclosure and policy definitions. That tends to push insurers and advisers toward clearer questions and clearer documentation.
FAQ: UK life insurance statistics (quick answers)
Is life insurance common in the UK in 2025?
Not really. The FCA Financial Lives Survey reports 28% of UK adults held life insurance in 2024. That implies 72% do not. :contentReference[oaicite:17]{index=17}
Do life insurance claims usually pay out?
Yes, most do. ABI reporting shows term life new claims were paid at 96.5% in 2024. ABI also reports the proportion of new individual claims paid stays at or above 97.9% over the last decade. :contentReference[oaicite:18]{index=18}
How much did UK insurers pay out in protection claims recently?
ABI & GRiD figures show a record £8.0bn paid in combined group and individual protection claims in 2024. That is about £21.9m per day. :contentReference[oaicite:19]{index=19}
What’s the average payout for a life insurance claim?
ABI’s 2024 data shows an average term life claim of about £79,703. Whole-of-life averages are lower (around £7,408) because many policies are smaller, fixed sums. :contentReference[oaicite:20]{index=20}
How much does life insurance cost per month in the UK?
It depends on your age, term, cover amount, and health. Compare the Market reports an average of £17.07/month under specific assumptions (September 2025). Legal & General reports an average of £27.95/month from its 2024 figures. :contentReference[oaicite:21]{index=21}
Why do people think life insurance is expensive?
Research summarised from Legal & General shows people estimated £79.50/month, which was 184% higher than an average L&G policy cost of £27.95 in 2024. It also reports 27% called life insurance “too expensive.” :contentReference[oaicite:22]{index=22}
Conclusion: what to do next (simple timeline)
In 2025, the stats paint a clear picture. Most people still don’t have life insurance (28% holding). Claims are paid at high rates (term life 96.5% in 2024). And the industry paid out at record levels (£8.0bn in 2024). If you’ve delayed because you think it’s expensive, the 184% perception gap is your cue to check real quotes.
- Today: decide what you need to protect (debt, dependants, income).
- This week: compare quotes and lock cover in while your health profile is stable.
- This month: store documents and review beneficiaries.
- Within 12 months: review after any major life change.
Ready to see what cover looks like for you? Get a Free Quote
Key sources: FCA Financial Lives; ABI claims; FCA PSD; L&G cost statements; FOS complaints data. :contentReference[oaicite:23]{index=23}
Sources (complete citations)
- FCA — Financial Lives 2024 survey: General insurance & protection (PDF) (published 2024). :contentReference[oaicite:24]{index=24}
- ABI — Record £8bn paid out in vital protection claims during 2024 (published 14 July 2025). :contentReference[oaicite:25]{index=25}
- FCA — Product Sales Data (FOI): Life insurance / pure protection sales to Q1 2025 (published May 2025). :contentReference[oaicite:26]{index=26}
- Compare the Market — Life insurance calculator (average premium reference) (references September 2025). :contentReference[oaicite:27]{index=27}
- Legal & General — Life insurance calculator (2024 average cost statements) (page accessed via public site). :contentReference[oaicite:28]{index=28}
- Actuarial Post — L&G cost perception gap summary and quote (James Shattock) (published 2025, as displayed on page). :contentReference[oaicite:29]{index=29}
- Financial Ombudsman Service — Press release: complaints received in H2 2024 (published 6 May 2025). :contentReference[oaicite:30]{index=30}
- FCA — Market Study MS24/1.2: Distribution of Pure Protection Products (Terms of Reference) (published 2024; analysis planned during 2025). :contentReference[oaicite:31]{index=31}
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Internal linking suggestions (Insurance Hero)
- Link from this guide to: Compare Life Insurance Quotes (primary CTA).
- Link to your needs guide: How much life insurance do I need?
- Link to product explainers: Term Life Coverage and Whole of Life Cover
- Link to pricing intent: Average Cost of Life Insurance
- Link to related protection: Critical Illness Guide and Income Protection
Recommended images & charts (with alt text)
- Hero image: “Family reviewing finances on a laptop”
Alt: “UK couple reviewing life insurance cover and costs in 2025” - Chart 1: “Protection claims paid in 2024 (£8.0bn) vs daily equivalent (£21.9m)”
Alt: “Bar chart showing ABI-reported £8.0bn protection claims paid in 2024 and the daily equivalent” - Chart 2: “Life insurance ownership: 28% overall vs 57% mortgage holders”
Alt: “Comparison chart showing FCA-reported life insurance ownership among UK adults and mortgage holders” - Chart 3: “Pure protection sales: 2024 Q4 vs 2025 Q1”
Alt: “Line chart showing FCA product sales data for pure protection contracts across 2024–2025 quarters” - Callout graphic: “Cost perception gap 184% (£79.50 expected vs £27.95 average L&G policy cost)”
Alt: “Infographic comparing expected and average life insurance costs reported by L&G research”
How to Understand UK Life Insurance Statistics: Make Smarter Cover Choices with Insurance Hero in 2025
In 2025, the most useful UK life insurance stats answer three things fast: who has cover, what gets paid, and what claims succeed. Right now, 28% of UK adults hold life insurance and insurers paid £8.0bn in protection claims during 2024.
Opening hook: UK insurers paid the equivalent of £21.9 million every day in 2024 protection claims, according to ABI & GRiD.
Data sources include the FCA Financial Lives Survey (published 2024) and ABI protection claims reporting (published 2025).
Executive summary: the stats people actually use
- Coverage: 28% of UK adults report holding a life insurance policy in 2024. That means 72% do not. (FCA Financial Lives)
- Payouts: Insurers paid a record £8.0bn across individual + group protection claims in 2024, or £21.9m per day. (ABI & GRiD)
- Claim success: The proportion of new individual claims paid stays at or above 97.9% over the last decade. (ABI)
- Affordability: UK consumers often overestimate costs by 184% (£79.50 expected vs £27.95 average L&G policy cost in 2024). (L&G via Actuarial Post)
Sources: FCA Financial Lives Survey 2024 protection findings; ABI 2024 protection claims release (published July 2025); L&G pricing perception reporting. :contentReference[oaicite:0]{index=0}
Table of contents
- 1What are the headline UK life insurance stats in 2025?
- 2How many UK adults have life insurance right now?
- 3How much do UK insurers pay out, and how often are claims accepted?
- 4Which claim types pay the most, and what causes claims?
- 5Are more people buying cover in 2024–2025?
- 6What does life insurance cost in the UK in 2025?
- 7Why do people delay buying life insurance?
- 8How do complaints and disputes look for insurance?
- 9What can you do with these stats when choosing cover?
- 10What trends should you watch in 2025–2026?
- FAQQuick answers (schema-ready)
- ↗Sources and citations
1) What are the headline UK life insurance stats in 2025?
If you only remember five numbers, remember these. 28% of UK adults say they hold a life insurance policy. Insurers paid £8.0bn in protection claims during 2024. That equals £21.9m per day. New claims are paid at very high rates, staying at or above 97.9% for the last decade. And for term life claims, the average payout is about £79,703.
Here’s why this matters. These stats give you a reality check. They show most people still don’t have cover. They also show claims usually pay out when policies are set up correctly. According to the ABI, common decline reasons include non-disclosure and not meeting policy definitions.
2) How many UK adults have life insurance right now?
The cleanest “ownership” number comes from the FCA Financial Lives Survey. It reports 28% of all UK adults held a life insurance policy in 2024. That makes life insurance the most commonly held protection policy in that dataset.
The detail is just as useful as the headline. For example, FCA data shows 57% of mortgage holders report having life insurance. That’s a big difference from the overall population. It also tells you how life insurance is often tied to major debts, especially mortgages.
Insurance Hero tip: if you’re buying a home, you’re already in the “most likely to need cover” group. If you rent, the need can still be real, but it’s usually driven by dependants and income.
| Group | Life insurance holding | What it suggests |
|---|---|---|
| All UK adults (2024) | 28% | Most people are still uninsured |
| Mortgage holders (2024) | 57% | Cover is strongly linked to debt protection |
| Any protection insurance (2024) | 46% | Many have something, fewer have life cover |
FCA Financial Lives Survey 2024, protection findings. :contentReference[oaicite:3]{index=3}
3) How much do UK insurers pay out, and how often are claims accepted?
The ABI’s latest claims release is blunt in the best way. Insurers paid a record £8.0bn in combined group and individual protection claims in 2024. For individual protection (life, critical illness, income protection), payouts total £5.32bn. Meanwhile, new individual claims paid remains high, and the ABI reports a decade-long trend of 97.9% or above.
You can also zoom into life insurance specifically. In 2024, ABI reporting shows term life new claims paid at 96.5%. Total term life value paid is £4.025bn. The average term life claim sits around £79,703. That average gives you a sanity check when you’re choosing your sum assured.
Quick comparison table: claim success by product (2024)
| Product | New claims paid | % of new claims paid | Average value of claims paid |
|---|---|---|---|
| Term life | 50,499 | 96.5% | £79,703 |
| Critical illness | 20,990 | 89.7% | £68,735 |
| Whole of life | 206,839 | 99.99% | £7,408 |
ABI protection claims reporting (published July 2025). :contentReference[oaicite:5]{index=5}
4) Which claim types pay the most, and what causes claims?
Statistics become useful when they help you picture real scenarios. ABI data shows critical illness is a high-value claim category. In 2024, the total value of critical illness claims reached £1.3bn. The average critical illness claim is about £67,600. Cancer remains the most common reason, making up 62% of critical illness claims. Total cancer payouts reached £812m.
For income protection, ABI reports total payouts of £204m in 2024. The average income protection payout is around £10,000. Musculoskeletal issues lead the volume of claims at 34%. ABI also notes at least £32m in payouts linked to these issues, even though not every case records a reason.
5) Are more people buying cover in 2024–2025?
One of the clearest “fresh” indicators is FCA Product Sales Data for pure protection contracts. In Q4 2024, firms reported 252,570 pure protection sales. In Q4 2023, it was 219,419. That is roughly a 15.1% rise year-on-year. It suggests demand picked up through late 2024.
Now check the most recent quarter in the same series. In Q1 2025, pure protection sales were 234,783. In Q1 2024, sales were 242,418. That’s around a 3.1% fall year-on-year. So the picture is mixed: a strong Q4, then a softer Q1.
Premium totals move too. FCA reports total premium amounts of £106.3m for pure protection in Q4 2024 and £111.4m in Q1 2025 (annualised where relevant). Treat this as a market signal, not your personal price.
| Quarter | No. of sales | Total premium amount |
|---|---|---|
| 2024 Q4 | 252,570 | £106,318,408 |
| 2025 Q1 | 234,783 | £111,430,935 |
FCA FOI release of Product Sales Data (published May 2025). :contentReference[oaicite:7]{index=7}
6) What does life insurance cost in the UK in 2025?
People usually ask this as: “What’s the average monthly premium?” Compare the Market states an average of £17.07 per month, based on certain assumptions, and references September 2025. It also says 51% of its customers were quoted less than that figure for a 10-year term up to £175k cover (no critical illness), in the same period.
Legal & General provides another real-world reference point. Its site says the average cost of Life Insurance is £27.95 per month using its 2024 figures. Both figures can be “true” because averages depend on age, cover amount, term length, smoker status, and extras.
| Source | Average stated | Timeframe / basis |
|---|---|---|
| Compare the Market | £17.07/month | Based on its customer quote data (September 2025 assumptions) |
| Legal & General | £27.95/month | L&G 2024 average life insurance cost statement |
Sources: Compare the Market life insurance calculator; Legal & General life insurance calculator page. :contentReference[oaicite:8]{index=8}
7) Why do people delay buying life insurance?
The most common blocker is cost — or rather, what people think it costs. A Legal & General study reported people estimate life insurance at £79.50 per month, which is 184% higher than the reported £27.95 average L&G policy cost in 2024. It also reports 27% of respondents say life insurance is “too expensive.”
The same reporting says 6.5 million UK adults are postponing financial products like life insurance until they reach “life milestones.” That sounds sensible, but it’s risky. Milestones like buying a home or starting a family can happen later. Meanwhile, your health can change sooner than you expect.
James Shattock, Managing Director UK Protection, says there’s a “significant perception gap” and that starting early can mean “lower premiums and stronger protection.” :contentReference[oaicite:9]{index=9}
8) How do complaints and disputes look for insurance?
Complaints stats don’t tell you “life insurance is bad.” They tell you what consumers challenge, and how the dispute system is coping. In the second half of 2024 (July–December), the Financial Ombudsman Service reports 22,075 new complaints in the general insurance/pure protection category. That compares with 22,845 in the same period of 2023. So, volumes look broadly stable for that category.
What’s changing is the overall system load. The Financial Ombudsman Service received 141,846 complaints across all products in July–December 2024, and says overall uphold rate was 33% for that half-year. These system-wide shifts can affect resolution times, even if your product area stays flat.
Source: Financial Ombudsman Service H2 2024 complaints press release (published May 2025). :contentReference[oaicite:11]{index=11}
9) What can you do with these stats when choosing cover?
Stats are only helpful if they change your next decision. Start with ownership: if only 28% of adults have life insurance, you’re not “weird” for being uninsured. You’re normal. But “normal” doesn’t mean “safe.” Next, look at payouts: £4.025bn paid in term life claims (ABI) shows life cover is used in real life, at scale.
Finally, focus on claim success. A term life new-claim pay rate of 96.5% strongly suggests the basics matter: honest disclosure, correct policy type, and sensible sums insured. That’s exactly where Insurance Hero helps, because we compare across insurers and match cover to your situation.
“Most claim problems come from avoidable paperwork issues — not because insurers ‘don’t pay’.” — Steve Case, Principal Consultant, Insurance Hero.
Implementation guide: a simple 7-step process (with timelines)
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1Today (10 minutes): List your “must-cover” costs (mortgage balance, rent, debts, childcare). Use ABI’s £79,703 average term life claim as a reality check. :contentReference[oaicite:12]{index=12}
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2Today (5 minutes): Decide the policy goal: mortgage-only (decreasing term) vs income replacement (level term).
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3This week: Gather disclosure info (GP conditions, meds, smoking status). ABI notes non-disclosure is a common decline reason. :contentReference[oaicite:13]{index=13}
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4This week: Compare quotes from multiple insurers (Insurance Hero does this for you). Use “average cost” stats (£17.07 or £27.95) only as a budget range. :contentReference[oaicite:14]{index=14}
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5Within 7 days: Choose beneficiary plan (and consider writing in trust if appropriate for your situation).
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6Within 14 days: Confirm policy schedule and keep documents in a shared folder. This helps beneficiaries claim faster.
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7Every 12 months: Re-check cover after life changes (new child, new mortgage, pay rise). FCA data shows mortgage holders behave differently, so changes matter. :contentReference[oaicite:15]{index=15}
10) What trends should you watch in 2025–2026?
Three signals matter going into 2026. First is engagement. If only 28% of adults have life cover, the “protection gap” is still huge. Second is affordability messaging. The 184% perception gap reported around pricing is exactly the kind of problem that drives late buying. Third is market scrutiny. The FCA’s pure protection distribution market study states it planned to publish analysis during 2025. That can shape how products are sold and explained.
Expect more focus on plain-English explanations. The ABI also reports common decline reasons include non-disclosure and policy definitions. That tends to push insurers and advisers toward clearer questions and clearer documentation.
FAQ: UK life insurance statistics (quick answers)
Is life insurance common in the UK in 2025?
Not really. The FCA Financial Lives Survey reports 28% of UK adults held life insurance in 2024. That implies 72% do not. :contentReference[oaicite:17]{index=17}
Do life insurance claims usually pay out?
Yes, most do. ABI reporting shows term life new claims were paid at 96.5% in 2024. ABI also reports the proportion of new individual claims paid stays at or above 97.9% over the last decade. :contentReference[oaicite:18]{index=18}
How much did UK insurers pay out in protection claims recently?
ABI & GRiD figures show a record £8.0bn paid in combined group and individual protection claims in 2024. That is about £21.9m per day. :contentReference[oaicite:19]{index=19}
What’s the average payout for a life insurance claim?
ABI’s 2024 data shows an average term life claim of about £79,703. Whole-of-life averages are lower (around £7,408) because many policies are smaller, fixed sums. :contentReference[oaicite:20]{index=20}
How much does life insurance cost per month in the UK?
It depends on your age, term, cover amount, and health. Compare the Market reports an average of £17.07/month under specific assumptions (September 2025). Legal & General reports an average of £27.95/month from its 2024 figures. :contentReference[oaicite:21]{index=21}
Why do people think life insurance is expensive?
Research summarised from Legal & General shows people estimated £79.50/month, which was 184% higher than an average L&G policy cost of £27.95 in 2024. It also reports 27% called life insurance “too expensive.” :contentReference[oaicite:22]{index=22}
Conclusion: what to do next (simple timeline)
In 2025, the stats paint a clear picture. Most people still don’t have life insurance (28% holding). Claims are paid at high rates (term life 96.5% in 2024). And the industry paid out at record levels (£8.0bn in 2024). If you’ve delayed because you think it’s expensive, the 184% perception gap is your cue to check real quotes.
- Today: decide what you need to protect (debt, dependants, income).
- This week: compare quotes and lock cover in while your health profile is stable.
- This month: store documents and review beneficiaries.
- Within 12 months: review after any major life change.
Ready to see what cover looks like for you? Get a Free Quote
Key sources: FCA Financial Lives; ABI claims; FCA PSD; L&G cost statements; FOS complaints data. :contentReference[oaicite:23]{index=23}
Sources (complete citations)
- FCA — Financial Lives 2024 survey: General insurance & protection (PDF) (published 2024). :contentReference[oaicite:24]{index=24}
- ABI — Record £8bn paid out in vital protection claims during 2024 (published 14 July 2025). :contentReference[oaicite:25]{index=25}
- FCA — Product Sales Data (FOI): Life insurance / pure protection sales to Q1 2025 (published May 2025). :contentReference[oaicite:26]{index=26}
- Compare the Market — Life insurance calculator (average premium reference) (references September 2025). :contentReference[oaicite:27]{index=27}
- Legal & General — Life insurance calculator (2024 average cost statements) (page accessed via public site). :contentReference[oaicite:28]{index=28}
- Actuarial Post — L&G cost perception gap summary and quote (James Shattock) (published 2025, as displayed on page). :contentReference[oaicite:29]{index=29}
- Financial Ombudsman Service — Press release: complaints received in H2 2024 (published 6 May 2025). :contentReference[oaicite:30]{index=30}
- FCA — Market Study MS24/1.2: Distribution of Pure Protection Products (Terms of Reference) (published 2024; analysis planned during 2025). :contentReference[oaicite:31]{index=31}
Schema markup (copy/paste)
Add the JSON-LD below into your page template, inside <head> or just before </body>.
Update the URLs, author, and publish date to match your CMS.
1) Article schema (Insurance Hero)
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}4) Review/rating schema (optional)
Only use Review schema if you have a genuine, verifiable review system on-page (e.g., Trustpilot embed, verified testimonials, or review collection process).
Internal linking suggestions (Insurance Hero)
- Link from this guide to: Compare Life Insurance Quotes (primary CTA).
- Link to your needs guide: How much life insurance do I need?
- Link to product explainers: Term Life Coverage and Whole of Life Cover
- Link to pricing intent: Average Cost of Life Insurance
- Link to related protection: Critical Illness Guide and Income Protection
Recommended images & charts (with alt text)
- Hero image: “Family reviewing finances on a laptop”
Alt: “UK couple reviewing life insurance cover and costs in 2025” - Chart 1: “Protection claims paid in 2024 (£8.0bn) vs daily equivalent (£21.9m)”
Alt: “Bar chart showing ABI-reported £8.0bn protection claims paid in 2024 and the daily equivalent” - Chart 2: “Life insurance ownership: 28% overall vs 57% mortgage holders”
Alt: “Comparison chart showing FCA-reported life insurance ownership among UK adults and mortgage holders” - Chart 3: “Pure protection sales: 2024 Q4 vs 2025 Q1”
Alt: “Line chart showing FCA product sales data for pure protection contracts across 2024–2025 quarters” - Callout graphic: “Cost perception gap 184% (£79.50 expected vs £27.95 average L&G policy cost)”
Alt: “Infographic comparing expected and average life insurance costs reported by L&G research”
Steve Case is a seasoned professional in the UK financial services and insurance industry, with over twenty years of experience. At Insurance Hero, Steve is known for his ability to simplify complex insurance topics, making them accessible to a broad audience. His focus on clear, practical advice and customer service excellence has established him as a respected leader in the field.
