How much life insurance do I need?

'How much life insurance do I need?' is a question that is asked frequently. Basically, the cost of life insurance depends on two factors:

1. How much cover you want.
2. How long you want it for.

Then your age, sex, occupation, health and smoking habits are taken into account. The other issue affecting premiums is your medical history and current state of health. If you have any concerns, please do call us so we can advise on the most appropriate insurer for your circumstances.

There are many life insurance calculators out there, we recommend the This is Money website who have a good life insurance calculator.

Here are some typical life insurance costs taken from the Post Office in Jan 2009.

Level term monthly premiums

£100,000 of cover for a period of 10 years
	Female		Male
Age	Smoker	Non-smoker	Smoker	Non-smoker
25	£5.25	£5.00	£8.09	£6.17
30	£6.00	£5.00	£8.68	£6.18
35	£7.60	£6.60	£11.18	£7.58
40	£11.70	£7.87	£14.99	£9.28
45	£19.49	£10.58	£23.89	£13.18
50	£32.39	£15.79	£39.49	£19.39
55	£52.98	£24.40	£69.06	£30.71

£150,000 of cover for a period of 10 years
	Female		Male
Age	Smoker	Non-smoker	Smoker	Non-smoker
25	£7.85	£6.46	£11.15	£6.17
30	£9.35	£6.61	£12.20	£6.18
35	£12.05	£8.45	£15.65	£7.58
40	£17.60	£11.45	£22.40	£9.28
45	£29.45	£15.95	£36.01	£13.18
50	£48.05	£23.45	£58.85	£28.40
55	£79.66	£35.41	£103.25	£44.75

Decreasing term monthly premiums

£100,000 of cover for a period of 10 years
	Female		Male
Age	Smoker	Non-smoker	Smoker	Non-smoker
25	£5.00	£5.00	£6.12	£5.01
30	£5.02	£5.00	£6.47	£5.05
35	£6.06	£5.00	£8.06	£5.52
40	£8.01	£5.41	£10.58	£6.91
45	£12.76	£7.52	£16.11	£9.08
50	£21.31	£11.21	£25.91	£13.31
55	£34.21	£16.41	£43.21	£20.31

£150,000 of cover for a period of 10 years
	Female		Male
Age	Smoker	Non-smoker	Smoker	Non-smoker
25	£6.46	£5.71	£10.06	£6.76
30	£7.06	£6.01	£10.06	£6.76
35	£8.71	£6.01	£12.01	£9.16
40	£12.01	£7.66	£15.91	£9.91
45	£19.51	£11.41	£24.16	£13.66
50	£31.36	£16.81	£38.86	£19.96
55	£51.31	£24.61	£63.46	£30.46

Your monthly premium will depend on a number of things, including the level, type and length of cover, medical history, your age and gender and whether or not you smoke. Some typical monthly premiums are shown below. You can apply for life insurance if you are between 18 and 66.

Get a life insurance quote from the Post Office or call 0800 096 5484*.

How much life cover do I need?
If you're the breadwinner, you will want to keep your family in something like the style to which they have become accustomed. If you're a carer, then you want to provide cash for professionals to take over because you're not around.

Generally speaking, the figure should be enough to produce around two thirds of your earnings or £20,000 for professional care each year.

How long for?
Until your dependants are old enough to look after themselves. 20 years is about right for most people, or until your savings can adequately provide for you and your partner - possibly by the time you're 60 years old.

How much mortgage cover do I need and for how long?
You need to cover the amount of the outstanding debt, up until the debt is paid off.

What type of cover do I need?
Is your mortgage a repayment one? If so, you need a Decreasing Term Assurance policy. Or is it an interest-only mortgage, in which case you need a level term policy.