4 in 10 parents don't have life insurance – is your family protected?

If you have children who rely on your income, life insurance can offer financial protection – but many families are going without it.

New research from Compare the Market shows 39% of parents don’t have any cover in place, despite many saying they worry about how their family would cope financially if they died. 

Here, we explain why life insurance might be worth considering if you have dependents, and how to choose the right cover for your family.

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Do you have life insurance?

A survey by the comparison site Compare the Market found that 48% of parents have a life insurance policy, and 21% are covered by death-in-service benefits through work. 

Only 8% have both types of cover, and 39% have neither.

This is despite the fact that 90% of parents say they worry about what would happen to their children if they died.

Figures from the Childhood Bereavement Network show that around 26,900 parents die each year in the UK leaving dependent children.

• Find out more: types of life insurance

What happens if parents die without having cover?

If a parent dies without life insurance, paying the mortgage could become a problem. 

According to Compare the Market's survey, 53% of parents with a mortgage still owe more than £100,000, with the average outstanding balance at £145,720.

Many families don’t have the savings to fall back on. 42% of parents with a spouse said their partner wouldn’t be able to afford the rent or mortgage on a single income. 

Many parents also have other debts. 70% owe money on credit cards or loans, averaging around £5,115. These debts would usually be paid from the estate, reducing what’s left to pass on.

• Find out more: whole-of-life insurance explained

How much does life insurance cost?

The price you pay for life insurance varies significantly depending on your personal circumstances and the level of cover you need. 

Any health conditions you have, or aspects of your lifestyle that could affect your life expectancy, such as drinking or smoking, may also impact your price. 

Your age has a major influence too, and cover is substantially cheaper to buy when you're young.

For example, a 30-year-old non-smoker buying £300,000 cover can expect to pay around £117 a year, but a 50-year-old buying the same product can expect to pay £580.

• Find out more: best life insurance providers 2025

Are there any alternatives to life insurance?

Life insurance isn’t the only way to protect your family’s finances. Depending on your circumstances, you might also consider:

• Savings and investments: setting money aside over time could provide a financial cushion for your family.
• Income protection insurance: this pays you a portion of your salary if you can’t work due to illness or injury.
• Critical illness cover: provides a lump sum if you’re diagnosed with a serious health condition.
• Redundancy insurance: supplies short-term financial support if you lose your job.
• Family income benefit: pays out monthly instead of a lump sum, helping with ongoing costs.

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How to find the right cover for your family

If you’re thinking about life insurance, it’s important to find a policy that fits your needs. Consider these steps first: 

Consider the type of cover you need

Start by deciding between term life insurance and whole-of-life insurance.

Term cover runs for a fixed period, such as until your mortgage is paid off or your children are financially independent.

Whole-of-life cover guarantees a payout whenever you die, but it usually comes with higher premiums. See our guide to the different types of policy.

Choose the right level of cover

Think about how much money your family would need if you weren’t around. This is called the 'death benefit' and should cover things such as mortgage payments, bills and everyday living costs.

If you’re choosing term life insurance, you’ll need to pick how many years your policy lasts.

• Find out more: do you need life insurance for a mortgage?

Compare quotes and providers

Life insurance isn’t just sold by banks and insurers – supermarkets, retailers and membership groups sometimes offer competitive deals, too. 

In some cases, the same policy may be sold under different brands at different prices.

Some policies are sold through advisers that earn a commission from the provider. This doesn't always mean you're getting poor value, but it’s a good reason to compare what’s on offer and check the costs. The financial regulator is currently reviewing how these policies are sold to make sure consumers are getting a fair deal.

• Find out more: are life insurance perks worth it?

Review your policy regularly

Major life events such as getting married, having children or buying a home can all affect how much cover you need, so it’s important to check your policy still reflects your current circumstances.

• Find out more: Brits take an average of 10 months to buy life insurance