What is life insurance?

Life insurance (also called life cover or death cover) pays a lump sum if you die. Most policies also pay early if you are diagnosed with a terminal illness and are not expected to live beyond a set period, usually 24 months.

The money goes to your beneficiaries or your estate. They can use it however they need to, for example to:

• Pay off the mortgage and other debts
• Replace your income so the family can keep its lifestyle
• Cover childcare, school fees and future education
• Pay for the funeral and legal costs
• Give a partner time off work to grieve and adjust

What affects the price of your quote

• You share the basics. Age, gender, smoker status, job, and how much cover you want.
• We compare insurers. We look at price, but also policy definitions, extra benefits and claims history.
• You pick a premium type. Stepped or level (see below).
• You apply. You answer health, lifestyle and family history questions.
• The insurer decides. This is called underwriting. The outcome is standard terms, a higher premium (a "loading"), an exclusion, a delay or a decline.
• Cover starts. You get a cooling-off period, usually at least 14 days and often 30, to change your mind and get a refund.

Tip: A quote is only a starting point. The final price is set after underwriting.