£500,000k Life Insurance

A life insurance policy offering £500k of cover is a big financial commitment, so it’s essential to do your research and seek advice if you’re considering one.

Here you’ll learn whether £500,000 cover is enough for you, how much this policy will cost, and how to get the right advice about your protection insurance options.

Is £500k life insurance enough cover for you?

There are calculations you can do to help you answer the question of whether £500,000’s worth of life insurance is enough for you, specifically…

• Multiply your annual salary by the number of years your beneficiaries will be financially dependent on you after you have passed away

• Add up all expenses and obligations you would need to cover for your family

This number crunching should give you a rough idea of whether £500k will cut it, but some people base the amount of life insurance they buy on specific debts they have. For example, you might have £500k remaining on a joint mortgage and take out a policy for this amount so the other person can own the property outright after you are gone.

If you’re unsure whether £500,000 life insurance is enough of a safety net for you, get in touch and one of our protection insurance specialists will draw up bespoke calculations.

How much does a £500,000 life insurance policy cost?

The average cost of a £500,000 life insurance policy in the current market is anywhere between £14.86 per month and £22.96 per month. This is based on a market comparison for a 30-year-old male with no existing health conditions or risk factors.

These figures are for a £500k life insurance policy that would cover you for 25 years, taken out on a level term basis, but keep in mind that premiums can vary dramatically.

The actual cost of your coverage will depend on a range of different factors, including your general health and the type of policy you choose.

Factors that will determine your premiums

The main variables that will shape premiums on a £500,000 life insurance plan, and therefore the cost of the policy, have been broken down below.

• Age: Premiums typically increase with age; the older you are when you take out the policy, the more you will pay.

• Amount of coverage: Larger payouts result in higher premiums. Consequently, you should expect costs to rise further if you are seeking cover that exceeds £500k.

• Health and lifestyle: Existing health conditions can increase the cost of cover, as can lifestyle choices such as smoking and regular drinking. Engaging in high-risk hobbies, such as rock climbing or scuba diving, can also lead to higher premiums.

• Occupation: Working in a high-risk profession, such as the military or the police service, can increase the risk to the insurer and therefore drive up the cost of a £500k policy.

• Policy type: Level term plans are generally more expensive than decreasing term policies, while whole-of-life, over-50s, and increasing term insurance options tend to have the highest premiums.

• Gender: Life insurance rates are typically slightly lower for women than for men.

How age affects premiums

The table shows how the monthly cost of a £500,000 life insurance policy can vary depending on the age of the applicant. These are based on calculations from a leading insurance provider but have been presented purely for example purposes.

How much extra smokers will pay

The exact extra amount smokers will pay for a £500K life policy compared to a non-smoker will vary depending on factors such as the number of cigarettes typically smoked per day and whether you have underlying health problems or a family history of them.

For comparison purposes: the average cost of a 25-year life insurance policy that provides £500k of coverage for a non-smoker is between £14.86 and £22.96 per month, while the average cost for a smoker is between £25.70 and £45.70 per month.

How to get a £500k life insurance quote online

The best way to get bespoke quotes for a £500,000 life insurance policy is to have a whole-of-market life insurance adviser, like us, draw them up for you.

We are on panel with every insurer in the UK, which means we can advise on their products and often have access to exclusive deals. When we compile quotes for you, the deals we highlight will be personalised recommendations from across the entire market.

You will be presented with options from mainstream insurance providers as well as specialist insurers for those with complex needs, and we will offer expert advice on which to choose.

Get started with a free, no-obligation chat and access your quotes below:

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How much a £500,000 life insurance policy pays out

The amount of payout you will get from a £500,000 life insurance policy will depend on the type of plan you have. The three main types are outlined below:

• Level cover: This will payout a flat £500k regardless of when you pass away within the confines of the cover period.

• Decreasing term cover: Pays out a reduced amount the further into the policy you pass away (see the table below for example calculations).

• Increasing term cover: Pays out a rising amount the further into the policy you pass away (see the table below for example calculations).

Decreasing term cover

The table below shows estimated payouts for a £500k life insurance policy with a 10-year term that decreases by approximately 8% annually.

Increasing term cover

The table below shows estimated payout calculations for a £500k life insurance policy that increases by 4.5% annually to combat inflation.

Why choose Money Helpdesk for your £500k life insurance quote?

Our whole-of-life insurance brokers are well placed to help you find the most competitive quotes for your £500,00 life insurance policy.

Here are just some of the reasons our customers choose us:

• We are on panel with every insurer in the UK

• Our advisers can access exclusive life insurance deals

• We are 5-star rated on leading review websites

• You can access your bespoke quotes in seconds

Ready to take advantage of a free, no-obligation chat with a whole-of-market life insurance adviser to access your personalised quotes today? Get started here.