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Does Martin Lewis recommend Life Insurance?

In this guide, our insurance experts review the Martin Lewis life insurance recommendations from This Morning and MoneySavingExpert.com. Getting your head around life insurance can be difficult and so many of us understandably turn to financial experts like Martin Lewis for clarification and information.

Martin Lewis is by far the most well-known financial journalist and expert in the UK, which is why millions of households turn to him for guidance about life insurance and other financial products. Martin Lewis has made several TV and radio appearances where he explains the reasons for needing life insurance, especially for parents and people with dependents.

In our latest independent expert review, our insurance specialists review the Martin Lewis life insurance guidance on MoneySavingExpert.com and television interviews. We’ll explain what the Martin Lewis life insurance top tips are and offer more about how to get the best cover to protect your loved ones for less.

Millions of households now rely on the information from Martin Lewis and his team of financial experts to save money and make better finance choices. He also became a TV celebrity back in 2012 with his ITV series called ‘The Martin Lewis Money Show’ which was originally co-presented by Saira Khan, then Angellica Bell, and the current co-presenter is Jeanette Kwayke.

Martin Lewis life insurance guides have also featured in several interviews,  including This Morning where he explains how the cover works and his views on why he recommends life insurance. Below is a link to a short video of the Martin Lewis life insurance interview with Holly Willoughby and Phil Schofield.

Martin Lewis’ Guide to Life Insurance – How Much? | This Morning

You can see the full Martin Lewis life insurance interview on This Morning below, and our insurance experts explain more about his advice.

A picture of a stopwatch

60-Second Summary – Martin Lewis Life Insurance Information

Martin Lewis Life Insurance information and guides are a useful starting point when considering new or reviewing existing life cover policies. There are lots of different types of life insurance options which is why Martin Lewis suggests you should seek advice from an expert or specialist.

  • Martin Lewis Life Insurance guides are a very useful starting point when considering new cover or reviewing existing life insurance policies. There are several different types of life insurance policies, and this is why Martin Lewis suggests seeking advice from an expert or specialist
  • Read the Martin Lewis life insurance top tips carefully and make sure that you consider your options (e.g. 10 X annual income rule)
  • Check with your employer to see whether you have any cover through your job (i.e. death in service) that you can use as part of your cover (this should not replace life insurance)
  • Check out the Martin Lewis life insurance ‘need-to-know’ section to look at what the top tips are for getting the best and cheapest cover
  • Always avoid buying life insurance from your bank or direct from an insurance company because they charge more than a life insurance broker

Martin Lewis clearly says that he ‘100% recommends life insurance’ for anyone with children or financial dependents, to protect them financially if you die. Even though it isn’t a pleasant topic for many to talk about, we just need to “get over it” and make sure that your family is protected.

Martin Lewis life insurance rules are clear and state that you need to make sure that you’ve got at least something in place to protect your loved ones, especially if you’re the main breadwinner.

An image of a happy family and a price comparison for life insurance policies bought through iam|INSURED and price comparison websites. 
Based on the same applicant, the cost of life insurance if bought through iam|INSURED is £13.29 per month compared to £15.88 with MoneySuperMarket and £15.26 with Compare the Market.

*Quotes provided above are accurate on 11.12.2023 for £200,000 of Level Term life insurance (family protection) over a 25 year term single life 40yrs of age non-smoker with no pre-existing medical conditions.

If you read about the history of Martin Lewis, then you might understand why he supports and believes in life insurance from his own personal experiences as a child.

We’re close to the area where Martin Lewis was raised as a child and so we’ve heard the stories about how he was affected by the loss of a parent as a child. Our offices are based in Chester which are also very close to the MoneySupermarket head offices so we hear a lot about Martin Lewis in the local community.

The story begins when Martin Lewis tragically lost his mother in a horse riding accident which involved a Heavy Goods Vehicle, when Martin was just 11 years of age. Martin Lewis later became a patron for a children’s bereavement charity called ‘Grief Encounter’, where he shared his experience of losing a parent at a young age.

It is clear that anyone who has been through such a catastrophic experience would want others to understand the implications of losing a parent. We also know of several other financial experts who have experienced a similar loss and who also advocate life insurance.

You can clearly see that Martin Lewis strongly recommends life insurance for families and he firmly believes in these policies. If you look at MoneySavingExpert’s then you will see that he clearly states ‘This is something every parent, partner, or person with any other type of dependent needs to consider’.

Note: Life insurance is the very best and cheapest way to protect your family and your home against financial loss if you die or if you become seriously ill. Life insurance starts from as little as £5 per month and it can make a huge difference to your family if they ever needed to make a claim.

It’s highly unlikely that you haven’t heard of Martin Lewis but you might not be familiar with MoneySavingExpert.com, which is where it all started. Today, MoneySavingExpert.com is the UK’s most visited consumer finance website which was launched in 2003 by Martin Lewis for only £100.

Currently MoneySavingExpert.com attracts millions of visitors every month looking for guidance and advice about consumer finances and financial issues. Martin Lewis life insurance guidance appears on a number of pages on MSE and you can also find several of his life insurance videos or interviews on YouTube.

There are literally thousands of pages of content on MoneySavingExpert.com and information about every different type of personal finance, including:

A list displaying the services available on MoneySavingExpert.com
A list displaying the services available on MoneySavingExpert.com

You can also subscribe to the weekly newsletter to receive regular updates from MoneySavingExpert.com with deals and the latest financial news.

You might not be aware that Martin Lewis sold the MoneySavingExpert.com website to the MoneySupermarket Group in 2012 for £87 million. Since then, Mr Lewis has taken the role of Executive Chairman at MoneySavingExpert.com where he now overseas around 100 staff.

Martin Lewis has always been a campaigner for consumer rights and fair deals when it comes to financial products. In fairness to the Martin Lewis life insurance guidance, it doesn’t seem to recommend MoneySupermarket life insurance or any other price comparison website.

Some people may be extremely surprised to learn that price comparison websites like MoneySupermarket are one of the most expensive places to buy life insurance currently.

Even though Martin Lewis sold MoneySavingExpert.com to MSM in 2012, it was tied to adhere to certain editorial rules about its financial guidance. This appears to continue through to today where you can clearly see that there is no bias towards the price comparison giant.

Note: Martin Lewis life insurance guidance consistently suggests that the cheapest place to buy cover is from a broker, and not from MoneySupermarket.

One of the most visible Martin Lewis life insurance guides is an interview with Phil Schofield and Holly Willoughby on ITV’s This Morning. The interview was recorded around 5 years ago and has received more than 62K views.

You can see the whole interview below and our own independent expert views on the Martin Lewis life insurance recommendations.

Martin Lewis’ Guide to Life Insurance – Different Types | This Morning

The interview begins with the common perceptions of many parents from presenter Holly Willoughby who says it is “a subject that many people find uncomfortable to talk about, and that is life insurance”. This shows where the current perceptions are for something that is extremely important, especially for parents.

Martin Lewis goes on to explain that “Life insurance is an insurance policy that pays out if somebody dies”, which is absolutely true, but also pays out if you become seriously ill as critical illness insurance falls under the same bracket.

The next important comment from Martin is “the reason it’s important because it’s there primarily to protect your loved ones that comes from a lack of income that would come, especially if the main breadwinner dies”.

Martin also then states that “if you look at a typical school class, one of those children will lose a parent before they were 18, one in twenty nine”. This is the important part of the interview for Mr Lewis, “I was one of them, which is why I’m so passionate about this”. Not many people know that Martin Lewis sadly lost his mother in a tragic car accident at the age of 11.

One of the other extremely important points raised in this interview is mentioned by Phil Schofield, when he says “ no one likes talking about this”. Martin Lewis’s blunt and truthful response to this is “let’s just get over your sensitivities and deal with it”. It’s extremely important that parents make sure that they consider what might happen to their family if one or even both parents were to die, which is a horrible thing to think about.

Martin Lewis then talks about the hard hitting real reason for life insurance when he says, “if a parent dies, there’s going to be grief, there’s going to be misery and it’s going to be incredibly difficult to deal with”. The purpose of life insurance is to cover “what the financial consequences would be on your family”. He explains “on top of all that grief, if suddenly you can’t pay your bills it compounds the problems”.

Our views on this Martin Lewis life insurance interview is that the recommendations for parents is hard hitting, but absolutely spot on. We need to get more parents to think about the financial implications of what might happen to their children if they die and prepare for that scenario with adequate life insurance.

Think about it this way, if you have life insurance and don’t claim on it then at least you’ve got it in case you need it. It’s better to have it and not need to use it than it is to need it and not have it.

There is a very clear message to readers on MoneySavingExpert.com and Martin Lewis himself about who needs life insurance. You will be able to see that it is recommended that all parents, partners and people with any dependents (e.g. children or parents) ‘need to consider’ life insurance.

As suggested in the Martin Lewis life insurance section of MSE, if you provide for someone or if your family would suffer financially without your income then this can be a very cheap ‘financial lifeline’.

One of the most important things to remember is that life insurance is not a requirement, even for a mortgage. This means that life insurance is 100% up to you and your own attitude to risk, so don’t feel like this is something that you have to do.

Here are some of the main factors from Martin Lewis life insurance guidance:

Do people with no dependents need life insurance?

It’s pretty clear that life insurance is designed to protect your family and dependents if you die, and so if you don’t have any then you don’t really need cover. Having someone that is financially dependent on you and your income is the main purpose for these policies.

It’s a good idea to think about what impact losing your income would have on those around you or close to you and then consider what life insurance would do if you die.

Have you got life cover from your employer, and is that enough?

Another area that is covered by Martin Lewis life insurance is employer benefits or protection such as ‘Death in Service’. Some employees, especially those employed by larger organisations, might have an employee benefits package that includes this.

Death in Service is a common benefit for most public sector jobs and some senior roles in corporate jobs. Some of the main points for this type of cover are:

  • Usually covers you for around 4 or 5 times your annual (gross) salary
  • Benefits are paid out regardless of whether death occurred in or out of work
  • Cover will cease if you change employer
  • Only available for employed and not self-employed workers
  • Not to be used as a alternative to life insurance, especially for mortgage protection

Having Death in Service can be a great benefit and can provide extra support and peace of mind if you’re worried about providing for your loved ones on death. You should be very careful about using this as a standalone cover for your family as there are risks to this that can be easily and cheaply overcome with life insurance.

Another key suggestion from Martin Lewis life insurance guidance is to take out cover sooner than later. We’ve covered this topic several times on iaminsured.co.uk and try to make people aware that life insurance is more expensive as you get older.

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One of the most confusing things about life insurance is ‘How much cover should I get?’ and lots of consumers are stumped by this. If you’re thinking ‘How much life insurance do I need?’, Martin Lewis has published his own ‘formula’ on this topic.

The Martin Lewis Life Insurance formula simplifies things for those who don’t understand what they want. So what’s the Martin Lewis Life Insurance magic formula? Well, it’s actually quite simple and that’s why it’s such a good place to start.

The ‘TEN TIMES annual income’ rule…

Basically, if you’re looking for Level Term Life Insurance then Martin suggests that you start off by looking for ‘10 times the main bread winners salary’. This means that if the main earner in the household dies then you’ll at least have a safe amount of cover.

You might think that this is a high number but when you think about it, you would want to make sure that your family is financially stable if you die. There are lots of things to think about such as your mortgage, debts, school fees, cost of living and even things like holidays are important.

Four of the key things with Martin Lewis’s Life Insurance cover guidance

  • Cover outstanding debts which includes any debts secured against your property (e.g. mortgage, second charges etc.), car finance, loans, credit cards etc.
  • Typical monthly outgoings that your family and children might be responsible for paying
  • Potential future outgoings such as school fees and further education
  • Other potential costs such as funeral expenses or tax liability (e.g. Inheritance Tax)

There are some other things to think about here that aren’t in the Martin Lewis Life Insurance formula that we’d like to point out.

  • Affordability is one of the most important parts about buying life insurance and making sure that it works for you and your family
  • Regularly review your cover to make sure that it fits your current needs as they change throughout your life

Life insurance isn’t just about trying to get the quickest solution and it’s important to make sure that it is right for you and your family. If your family should ever need it then you’ll definitely want to make sure that it’s right and gives them enough cover.

Note: Life insurance pays out a lump sum when you die and the amount of cover you need is up to you, so you should think about what financial support you want to leave for your family. It’s sometimes difficult to think about, but consider what you can afford and what your family would need if you weren’t around.

A family walking in a park with the caption 'Martin Lewis Life Insurance Guide 2023. Read our latest guide to Martin Lewis Cheaper Life Insurance '

Here are just a few quick tips and pointers from the Martin Lewis life insurance guide that you might need to know or think about. When you take out life insurance, there are literally loads of options and tonnes of things to consider, so here’s just a few key must knows.

1. Guaranteed premiums is the best option to fix your monthly premiums

Most life insurance premiums are quoted on a ‘guaranteed’ basis these days, unless you specifically request reviewable premiums.

Guaranteed premiums means that your life insurance premiums are fixed every month and will not change, regardless of what happens in the future to your health or any medical issues. The alternative option is reviewable premiums which means that your initial premiums might be slightly lower, however they may increase throughout the term of the policy if your health deteriorates.

2. Be honest and disclose all of your health and medical history when you apply for life insurance, or your policy might not pay out

It is extremely important when you apply for life insurance too be honest about your medical history and disclose everything that you are asked about. You don’t need to worry about disclosing things that aren’t on the only life insurance application, as these aren’t considered to be important.

In some cases, the insurer may request to look at your medical records alongside the answers you have given, but this is standard and not anything to worry about.

If you fail to disclose information or you withhold information on purpose then your life insurance policy is unlikely to pay out in the event of claim. Most life insurance policies will ask about your medical history including cancers, heart conditions, mental health, BMI, family history, smoker status, diabetes, and other lifestyle related questions.

You should answer all questions as openly and honestly as you possibly can do to ensure that your cover is valid should your family need to make a claim. If you are unsure then you should seek advice from a life insurance expert or contact 0800 009 6559 for more information.

Another point on the Martin Lewis life insurance guide is for guaranteed acceptance and over 50s life insurance, which will be different.

Over 50s life insurance and guaranteed acceptance life insurance do not require medical underwriting and will not ask about any pre-existing medical conditions or health issues. These policies can be more costly and are generally designed for specific purposes such as funeral expenses so they aren’t for everybody.

3. Joint life policies will only pay out once so consider two single policies

When a couple takes out life insurance they have the option of joint life policy which is one policy covering two people or two single life policies.

A joint life policy will always be cheaper because it covers both people on the same policy and will only pay out when the first person dies. If you’re only able to afford a joint life policy then this is certainly still a good option, however, two single life policies can work out more cost effective overall.

Generally, the difference in cost between a joint life policy and two single life policies makes it far more beneficial if you can afford two single policies. This way you would get double the amount of cover but the premiums only tend to be 20% to 30% higher.

If you both die during the term of your policy, then you would your family would get double the amount of cover and double the pay out with two single life policies.

4. Write your policy into trust is usually free and avoids paying unnecessary tax

One of the important bits about life insurance that many people don’t think about is, what actually happens if you die? Dealing with someone’s estate and all of the legal paperwork can be extremely costly and a lengthy process.

Any life insurance that you have in place if you die, will automatically form part of your estate, unless it is written into trust. Most good life insurance brokers will offer to write your life insurance policy into trust for free when you take out cover with them.

This should be an extremely simple process and can avoid your family having to wait unnecessarily for probate to be dealt with. You can also avoid paying up to 40% inheritance tax on any life insurance payout with a trust in place.

Writing your life insurance policy into trust should be fairly simple and should be free, for your insurance advisor to complete the trust paperwork on your behalf. If they do not offer to write your policy into trust then you can contact your life insurance company and ask them for trust documents.

You can also write your policy into trust at any point during the life of the policy term, so this could be done on any existing life insurance policies as well. For more information you can speak to one of our life insurance experts by calling 0800 009 6559 or click here.

5. You can cancel or switch your life insurance policy at any time without penalty (but you might not always be able to save money)

Life insurance is a monthly renewable insurance contract which means that it can be cancelled at any time without penalty. There are quite a few things to consider before you cancel any life insurance policy, most importantly that you will lose that cover.

It is definitely worth reviewing your life insurance policy every few years or so, to make sure that you’re on the best rates and that your cover is still suitable. People circumstances and situations change regularly so it’s always worth checking to make sure your life insurance still fits your needs.

If you’re reviewing your life insurance to try to save money then you should be aware the as you get older life insurance premiums get more expensive. It’s unlikely that if you’ve had a life insurance policy in place for several years that you’ll be able to get the same cover for less now.

Have you purchased life insurance via your bank, building society, or direct with an insurer?

If you bought a life insurance policy in the past via a bank, a building society or direct with a life insurance company, then you could be paying more than you need to. Life insurance is generally cheaper if you shop around and get quotes from life insurance brokers or price comparison websites.

If you’ve got an existing policy that you think might be more expensive than it should be, then it’s worth speaking to a life insurance expert to see whether you can reduce your premiums. For a free life insurance review you can contact one of our specialists on 0800 009 6559 or click here.

Change in lifestyle or improved health

If you took out life insurance in the past and you have since improved your lifestyle or your health is improved, then you might now be able to get life insurance cheaper. Life insurance premiums are based on your health, your occupation and any dangerous or hazardous sports.

Example: If you took out life insurance four years ago and you were overweight at the time, but since then you have dieted and lost considerable weight, you could reduce your premiums. People who reduced their BMI can potentially save money on life insurance by reviewing their cover.

Quit smoking or reduced alcohol consumption

If you were classed as a smoker or an excessive drinker when you took out life insurance originally, then you can reduce your premiums if you’ve stopped smoking or reduced the amount of alcohol you drink.

Smoking is considered to be higher risk for life insurance and so smokers will automatically pay as much as double that of a non-smoker. Similarly, if you were drinking excessively when you took out life insurance and you’ve since given up or reduced your alcohol intake, then you would be classed as a lower risk.

Note: To be classed as a non-smoker you would need to have been nicotine free (including patches, vaping or any other nicotine replacement products) for at least 12 months to be classed as a non-smoker.

You might not be aware that Martin Lewis sold the MoneySavingExpert.com website to the MoneySupermarket Group in 2012 for £87 million. Since then, Mr Lewis has taken the role of Executive Chairman at MoneySavingExpert.com where he now overseas around 100 staff.

Martin Lewis has always been a campaigner for consumer rights and fair deals when it comes to financial products. In fairness to the Martin Lewis life insurance guidance, it doesn’t seem to recommend MoneySupermarket life insurance or any other price comparison website.

Some people may be extremely surprised to learn that price comparison websites like MoneySupermarket are one of the most expensive places to buy life insurance currently.

Even though Martin Lewis sold MoneySavingExpert.com to MSM in 2012, it was tied to adhere to certain editorial rules and its ‘editorial code‘ about its financial guidance. This appears to continue through to today where you can clearly see that there is no biased towards the price comparison giant.

Note: Martin Lewis life insurance guidance consistently suggests that the cheapest place to buy cover is from a broker, and not from MoneySupermarket or any other price comparison site.

This is a great question and one that not many people actually ask to be fair, there are a few things to think about if you’re worried about your insurer going bust. Life insurance policies will usually last for well over 20 years and so a lot can happen in that time, especially in the current economic climate.

In recent times there have been a number of major life insurance companies and brands that have disappeared so it is a genuine concern. Lately we had Aegon, Canada Life and Old Mutual Wealth withdraw from individual life insurance. So what happens to my life insurance policy when my insurance provider stops selling new policies?

Generally, each life insurance policy is actiually re-insured by a larger company such as Swiss re., Gen Re. or Pacific Re., and these are massive global risk insurance companies. If you need to make a claim then these are generally the companies that would pay out, and not the actual insurance provider.

If your life insurance company does go bust then you are also covered by the Financial Services Compensation Scheme (FSCS).

As you’ll see when you read the Martin Lewis Life Insurance guide pages on MoneySavingExpert.com, there are several different types of insurance.

On his life insurance section of MSE you can read about the most common types of cover which are:

Level-term life insurance (family protection)

Level-term life insurance (family protection) which pays out a level lump sum if you die during the term of the policy. The term ‘level’ basically means that the cover amount never changes and always remains level throughout the policy.

As they clearly suggest on MoneySavingExpert, if you take out £200,000 of cover over 25 years then this is how much cover you will have for that period.

Note: MSE also says that cover usually runs to a maximum age of 80 which is no longer the case and most insurers will offer cover to age 90.

There are also several other ‘alternative types of life insurance’ that Martin Lewis suggests.

Decreasing term life insurance (mortgage protection)

Decreasing term life insurance (mortgage protection) is specifically for people who want to protect their mortgage if they die and make sure that their family home is protected.

This is also only for people with a repayment mortgage and it is not suitable for people with an interest only mortgage. This type of cover is cheaper than a level term life insurance policy because the cover amount reduces at a similar rate to your mortgage balance.

Note: Mortgage life insurance is not designed for people that want to leave a lump sum for their family as it clearly suggests on the Martin Lewis Life Insurance guide.

Family income benefit (FIB)

Family income benefit (FIB) is a less common type of life insurance but can also be very useful because it can work out cheaper than level or decreasing cover. Ultimately, this type of policy is designed to pay out an annual income to your family if you die and can and so can be useful for families wanting to provide an income rather than a lump sum.

Note: Family income benefit can be a more affordable option for those on lower incomes or people with pre-existing medical conditions.

Over 50s life insurance

Over 50s life insurance is a guaranteed acceptance policy that will provide your family with a lump sum on death to pay for funeral expenses and other related costs. There are several Martin Lewis Life Insurance warnings about this type of policy and it clearly suggests that you should be very careful about whether this is the right option for many consumers.

Note: You can read more about Martin Lewis warnings for this type of policy in the MoneySavingExpert Over 50s life insurance guide.

Whole-of-life insurance

Whole-of-life insurance is most commonly used for protecting inheritance tax liabilities and not designed for most typical consumers. Even though most of us would want a whole of life policy because it’s guaranteed to pay out, in reality these policies are expensive and impractical.

Note: In the Martin Lewis Life Insurance guide, it suggests that these policies are ‘often (but not always) investment-linked’ which is no longer the case. The vast majority of these policies are now completely insurance based and have now investment elements.

There are also several other types of cover that are not specifically explained in the Martin Lewis Life Insurance guide, such as:

Guaranteed acceptance life insurance

Guaranteed acceptance life insurance is a newer version of over 50s life insurance for younger individuals. These policies are usually available to people who are between the ages of 18 and 65. Often these are easier to apply for because there is no medical underwriting, but they can be less likely to pay out (especially for people with a pre-existing medical condition) and can be inflexible.

Personal accident insurance (death benefit)

Personal accident insurance (death benefit) will also usually provide an element of ‘accidental death’ cover within the policy terms. This can also be used as an alternative for those looking for a simple type of cover to protect themselves and their family, especially for people who take part in dangerous sports.

Business life insurance

Business life insurance is a policy that can be bought by companies to protect its owners and key individuals if they die. You can take out several different types of business protection that can pay out to the business or to the employees family as a benefit to them. This can also be a far more tax efficient and cheaper way to take out life insurance for business owners and key personnel.

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When asked ‘should I take out critical illness cover?’, Martin Lewis explains that he is not a big fan of this type of cover because of people being mis-led in to thinking that they are covered for ANY serious illness.

The reality of the matter is that this type of policy can be extremely useful for many families if needed and when bought properly. Unfortunately, these policies can be confusing which it also suggests in the Martin Lewis Life Insurance guide and they’re extremely complicated.

You can buy combined life insurance and critical illness cover, which Martin Lewis would potentially also advise against but ultimately the choice is yours.

Note: There are some good critical illness insurance policies and some that are clearly not so good, so it’s worth taking proper advice to make sure that you know what you’re buying as it clearly suggests on MoneySavingExpert.

We’ve done quite a bit of research on this trying to find some content or video guides from Martin Lewis about income protection insurance. Unfortunately, there isn’t any information about this type of cover on MoneySavingExpert.com or on any searches that we did.

We’ve produced our very own Income Protection Insurance Martin Lewis guide from the information that we could find and pieced together. It is strange that there is nothing from MSE about such a fundamental personal protection policy.

As experts in this area, we don’t necessarily agree with the views of Martin Lewis on pre existing conditions life insurance.

In the clip on This Morning you will see that the Martin Lewis Life Insurance advice suggests that cover will ‘cost a lot more’. This isn’t necessarily true for all, even though it can be the case that premiums might be significantly higher which is more relevant for people with serious medical issues.

There’s a range of possible outcomes with pre existing conditions life insurance which depend on:

  • Your age
  • Medical condition
  • Severity of condition or symptoms
  • Treatment or medication
  • Lifestyle (e.g. smoking, alcohol consumption, exercise etc.)

Most medical conditions can be covered by a life insurance policy and it can be a lot cheaper than you might think. It is worth getting proper advice from a medical life insurance specialist to see what your options are and how much you could save.

Things to remember about pre existing conditions life insurance:

  • You MUST disclose your medical history
  • Insurers might request a medical report (this isn’t a bad thing)
  • There are NO exclusions

Note: Get proper advice from a pre existing medical conditions life insurance specialist to help you to get the best cover and save money on your monthly premiums.

When you look at the interview that Martin Lewis does on This Morning you will hear that he suggests that he talks about life insurance for smokers.

As suggested, smokers do in fact pay more for life insurance and premiums can be as much as double non-smoker rates. This is quite rightly because the risk of someone dying in the term of the policy is higher due to the health risks linked with smoking.

Another point made in this Martin Lewis Life Insurance interview is that ‘to be classed as a non-smoker you need to be nicotine free for between one and five years’. This isn’t actually the case and almost all life insurance providers will class you as a non-smoker after 12 months of quitting smoking.

Vaping and life insurance

Another key element about smoking and life insurance that isn’t really covered in the Martin Lewis Life Insurance interview is that vaping also classes you as a smoker.

This includes nicotine free vaping and also means that you will pay higher premiums even if you are in the process of quitting. You will be eligible for non-smoker rates as soon as you pass that 12 month deadline and will then be a lower risk from a life insurance perspective.

Another one of the points that is raised in this interview which is very relevant, is the issue around inheritance tax and life insurance.

Martin Lewis’ Guide to Life Insurance – Inheritance Tax | This Morning

Life insurance pay outs are potentially liable for inheritance tax if they are above the lifetime allowance threshold or if the policy isn’t in trust. As Martin Lewis suggests, most life insurance policies will allow you to write a trust deed as part of the normal process.

This is usually free to do and most good life insurance brokers will offer this service as part of taking a policy with them.

A trust deed is a legal document that assigns a Trustee and a Beneficiary to your policy which helps to avoid probate and inheritance tax. It is not guaranteed that this will always happen, but it does mitigate the risk significantly in the event of a claim.

Facts about Inheritance Tax 23/24

  • Individual threshold: £325,000
  • Couples threshold: £650,000
  • Tax rate: Normally 40%

Note: Most people won’t need to worry about Inheritance Tax liability but it is worth writing your policy in trust to be certain. Trusts are generally free and will provide you with some peace of mind for your family if anything was to happen to you.

Another point that is raised and is very relevant is that most banks are not the best places to buy life insurance.

What most consumers don’t know and would probably be quite shocked to hear, is that banks tend to inflate life insurance premiums to get more commission. This is a fairly normal practice that has been happening in the financial services industry for decades.

If you’re considering buying life insurance from your bank then you should definitely compare that with a broker or IFA.

Something else that you should consider is that almost all banks are tied to one particular insurance provider. This means that you will only be provided with one quote and this might well be more expensive than other potential options.

One of the most common misconceptions is that life insurance is cheaper from a price comparison website. There are various websites where you can compare life insurance and Martin Lewis’ website MoneySavingExpert.com is actually owned by one of these companies (MoneySupermarket).

An issue with price comparison sites for life insurance as explained by Martin Lewis, is that most price comparison websites are in fact more expensive than brokers. The job of a life insurance broker is to search for the cheapest deal for you and they have many tools at their disposal to do this.

Often you might find that a price comparison website will lead you to a certain result or insurer. It is also true that most of these sites don’t have every insurer on their panel and so your options are limited.

Martin Lewis explains on his interview and various videos where he talks about life insurance, that getting advice is a good thing.

Most consumers don’t have the basic expertise that is required to know which type of life insurance is best for them and their family. In fact, you could get far better cover from a proper life insurance broker and end up paying far less.

Reasons for using a life insurance broker:

  • No fees
  • Free advice
  • Lower premiums
  • More choice
  • Better cover for your family
  • Pre existing medical conditions covered
  • Less hassle
  • Less chance of being declined or refused cover
  • Peace of mind

It’s not always easy to find a good life insurance broker and you might also think that most of these companies just want to sell you some cover. The reality is that there are lots of reputable life insurance brokers and you can usually see from their customer reviews. There are also many options for life insurance providers, which your broker will be able to explain to you clearly and in full detail.

Life Insurance provider reviews

We know from experience that Martin Lewis is clear about helping to protect consumers against financial loss and bad experiences. In the Martin Lewis life insurance guide you’ll see information about how to complain if you have a problem with your life cover and things to look out for.

We’d like to take this a step further and think about some of the things that you should be looking out for throughout the whole process.

Complaints about buying life insurance

If you bought life insurance through a broker then you have a number of options of you’ve been mis-sold or badly advised about cover.

Some of the issues that you might have with buying life insurance:

  • Poor customer service
  • Bad advice or recommendations
  • Mis-sold cover
  • Non-disclosure of medical conditions

You might have a number of issues when you take out life insurance with a broker and that’s why they all should have a clear complaints process. You can easily request a copy of their complaints procedure by contacting them or checking their website.

Note: It is a regulatory requirement to provide a full copy of their Terms & Conditions and complaints procedure. Failure to do this can result in a fine or investigation from the Financial Ombudsman Service (FOS).

Standard complaints procedure (brokers)

1. Report your complaint to the complaints officer or the person responsible for handling complaints in the business. This can be either a verbal or written complaint and all should be dealt with in the same way.

2. Acknowledgement letter should then be sent to you by email or in the post with a copy of the Financial Ombudsman Service (FOS) complaints brochure.

3. Investigations should then take place within a ‘reasonable’ period of time (usually 8 weeks) and you should then be provided with a full breakdown and response letter.

4. If you’re not satisfied with the outcome then you should escalate your complaint to the Financial Ombudsman Service (FOS) for further investigation.

Complaints about your life insurance policy

If you’ve got an issue with your life insurance policy then you should speak to your life insurance provider in the first instance. It is also a regulatory requirement for insurance providers to have a full complaints procedure that will work in a very similar way to an insurance broker or advisor (see above).

Potential complaints about life insurance policies:

  1. Claims procedures or unpaid claims
  2. Payment problems or direct debit issues
  3. Policy schedule issues (e.g. changes to Terms & Conditions)
  4. Unfair charges or fees

Note: You should always speak to your insurance provider first to give them a chance to satisfy your complaint before you referring to the Financial Ombudsman Service (FOS).

Financial Ombudsman Service Logo

Making a complaint to the Financial Ombudsman Service

The Financial Ombudsman Service (FOS) is an impartial and free service for financial services customers in the UK. This service can be used to settle any disputes between life insurance companies and their customers in the United Kingdom. If they feel that you have suffered any financial loss as a result of your life insurance policy, then they may rule for compensation to be awarded.

Telephone – 0800 023 4567 (or 0300 123 9123)

Telephone (outside the UK) – 0207 964 0500

Emailcomplaint.info@financial-ombudsman.org.uk

British Insurance Broker's Association (BIBA) Logo

What to do if you can’t find life insurance

There are certain options and support mechanisms that are available to you if you’re struggling to find life insurance. As suggested in the Martin Lewis life insurance guidance, one of the bodies to support consumers with life insurance is the British Insurance Brokers Association (BIBA) which covers all insurance services in the United Kingdom.

BIBA provides a Find Insurance service that allows you to search for a recommended member who might be able to help you.

Telephone (Insurance Help)- 0370 950 1790

Telephone (General Enquiries) – 0344 7700 266

Emailenquiries@biba.org.uk

Martin Lewis says openly that often your best option for fairly priced life insurance is to speak to a specialist broker. This especially true when compared to businesses such as price comparison websites who are often more focused on commission than getting customers the right policies.

Our skilled life insurance specialists have years of expertise and knowledge as well as access to whole of market quotes. This means we can search prices across every provider in the UK to make sure you never end up paying more than you need to.

Martin Lewis often talks about various other types of insurance policy. For more information about other forms of insurance you can read more of our Martin Lewis insurance guides:

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Is it worth paying for life insurance?

Yes, if you’ve got children or financial dependents then you should have life insurance to protect them if you die. Martin Lewis and the Financial Conduct Authority recommend that you take out life insurance to protect your family and your home. Generally, life insurance premiums start from as little as £5 per month and will be cheaper for younger adults.

Common myths about life insurance:

  • Life insurance won’t pay out (pays out 98% of claims)
  • People with medical conditions can’t have life insurance
  • Life insurance is expensive
  • Savings can be just as effective as life insurance
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What is the average cost of life insurance per month?

Based on recent research carried out, the average cost of life insurance is approximately £38 per month and the average level of cover is £152,000. Life insurance premiums also vary dramatically from one insurance provider to another and you can reduce your monthly premiums by shopping around.

Fundamentally, life insurance premiums vary depending on your age, health and the amount of cover that you need, starting from as little as £5 per month. You can also get life insurance to protect your family and your home against financial loss if you die.

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What does life insurance cover you for?

Life insurance is a monthly renewable ‘term insurance’ contract that pays out a cash lump sum or regular payments on death to your family or beneficiaries. Policies are most commonly used for family protection or mortgage protection for your loved ones if you die and your household income reduces, plus the additional issues of losing a parent or carer.

Traditional life insurance will not exclude any pre-existing medical conditions and will cover suicide after 12 or 24 months. You can also use life insurance for business protection purposes as well as tax-efficient business life insurance for directors or key people.

What are the disadvantages of life insurance?

The biggest and most common problem that consumers have with life insurance is the cost and the monthly premiums. This is the top reason for policy cancellations and why more people don’t take out life insurance to protect their family.

Another key disadvantage with life insurance is that it holds no investment value, nor can you cash it in. Life insurance works like any other traditional general insurance policy (e.g. car insurance, house insurance, pet insurance etc.), you pay a monthly premium and it will pay out in the event of a claim. Some people decide to use savings instead of taking out life insurance but you need to make sure that you have sufficient savings to cover the costs of death for your family.

Why do I need life insurance?

The fact is that nobody actually ‘needs’ life insurance, but it is strongly recommended that families and couples have cover to protect their loved ones in the event of death. Martin Lewis recommends life insurance and says “this is something that every parent, partner, or person with any other type of dependent needs to consider”.

Life insurance financially protects your loved ones if you die and pays out a cash lump sum to repay your mortgage, pay for school fees, replace lost income, and pay for regular outgoings. Mortgage life insurance is not linked to your mortgage debt so you can use it to pay off some or all of your mortgage.

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