Over half of people in the UK don’t have life insurance – is your family protected?

More than half of people in the UK don’t have life cover in place, leaving many households at risk of financial hardship if they were to die unexpectedly. 

According to the 2025 Life Insurance Index by UK-lifeinsurance.com, around one in seven aren’t even sure if they’re covered.

Yet confusion remains over what life insurance actually does, whether it’s needed for a mortgage, and how to choose the right policy.

Here, Which? answers three key questions about life insurance, explains what it really covers and shares how to find the right policy for your needs.

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What does life insurance cover?

Around 18% of people in the UK don’t know what life insurance is, and only 67% say they understand it.

These findings come from a survey of 2,000 UK adults carried out by UK-lifeinsurance.com as part of its 2025 Life Insurance Index.

Life insurance is designed to provide financial support to your loved ones if you die. Typically, a life insurance policy pays out a lump sum that can help cover everyday living costs, pay off debts such as a mortgage, or fund future expenses such as your children's education. 

There are many different types of policies. Term life insurance covers you for a set period, paying out if you die within that time. Whole-of-life insurance, on the other hand, covers you for your entire life as long as you keep up with payments. 

It is important to check exactly what your policy includes. Some only pay out on death, while others may include cover for serious illnesses too. 

Reviewing your policy documents or speaking to your insurer can help ensure your cover matches your family's needs. 

• Find out more: best life insurance companies

3 questions to ask about life insurance 

Confusion about life insurance stops many people from getting the cover they need. Here are three important questions to consider, based on findings from the survey.

1. Do you need life insurance for a mortgage?

Life insurance isn’t legally required to get a mortgage, although some lenders may ask for it as a condition. 

Nearly 30% of people think it’s mandatory, rising to 40% among millennials. This belief is most common in Northern Ireland, where 44% think life insurance is legally required for a mortgage.

While not compulsory, having life insurance can give you peace of mind that your family won’t struggle with repayments if you die.

• Find out more: life insurance options for your mortgage

2. What would my policy pay out?

Only 36% of people surveyed know what their life insurance or pension would pay out, while 27% are unsure. 

Awareness is lower among women, with just 29% understanding the payout compared to 44% of men. 

Check your policy documents or speak to your insurer to make sure you know what your family would receive if you died.

3. Can I rely on inheritance to cover major costs?

Around 11% of people in the UK say they’re relying on an inheritance from family to afford a home or fund their retirement. This rises to 13% among those aged 25 to 44 and 12% among people aged 45 to 54. 

Reliance is highest in the East of England and the North East (both 13%), while only 6% in Wales and the West Midlands say the same.

While inheritance can provide support, it isn’t guaranteed. Having life insurance in place offers a more secure way to protect your family’s financial future.

How to choose the right level of cover

The right amount of life insurance depends on your circumstances, but the main goal is to make sure your family has enough financial support if you’re no longer around. 

1. Assess your family’s financial needs: Think about essential costs your family would need to cover, such as paying off a mortgage or debts, funeral expenses, and everyday bills like rent or school fees.
2. Consider income replacement: Decide if you want your cover to replace your income for a set number of years to help your family adjust financially. Factor in any other household income or savings. 
3. Match cover to your debts: If your main aim is to pay off a mortgage or loan, a decreasing term policy, which reduces as your debt reduces, can be more affordable. 
4. Review your cover regularly: Life events like having children, buying a home or getting married can change your financial responsibilities. Check your policy periodically to make sure it still fits your needs.

Find out more:  do you have enough life insurance cover?