Life Assurance Calculator — Slide to See Your Cover

A life assurance calculator estimates two things: how much life cover your family would need if you died, and roughly what that cover would cost each month. It's the fastest way to move from "I should probably get life insurance" to an actual number you can take to a comparison site or adviser.

Most people either underinsure, leaving loved ones exposed to a mortgage and years of lost income, or overbuy, paying for far more cover than they need. A proper needs-based calculation — debts, income replacement and funeral costs, minus savings and any existing cover — gives a much more accurate figure than a rough guess.

This calculator goes a step further than most by also estimating your monthly premium for that cover amount, based on your age, the policy type and whether you smoke — so you get a complete picture in one place.

There's no single legally "correct" amount, but a widely used needs-based approach — sometimes called the DIME method (Debts, Income, Mortgage, Education) — adds up what your family would have to cope with financially, then subtracts what they already have:

Debts to clear — your outstanding mortgage balance plus any other debts such as loans, credit cards or car finance. Income replacement — your annual take-home income multiplied by the number of years your family would need support, often until children are financially independent. Funeral costs — the average UK funeral cost is around £4,700, and many people prefer this to be covered rather than come out of savings. Minus savings & existing cover — any savings, investments or life cover you already have in place, such as a workplace death-in-service benefit.

If you'd rather use a quick rule of thumb, a commonly cited guide is 5 to 7 times your annual salary in the UK, though this ignores your specific mortgage, debts and family circumstances, so a full needs-based calculation is usually more accurate. This calculator does the full calculation for you automatically.

Life insurance pricing depends heavily on age — the table below shows indicative monthly premiums for a healthy non-smoker buying £250,000 of level term cover over 25 years, illustrating how sharply cost rises as you get older.

Across the whole UK market, the average level term premium in 2026 is around £25 to £33 a month, and decreasing term averages around 30–35% cheaper for the same starting sum assured, since the insurer's risk falls over time. Whole of life cover is far more expensive, often averaging over £100 a month, because a payout is certain rather than dependent on dying within a fixed term.

Age is the single biggest factor — premiums roughly double every 7-8 years of age, since the statistical chance of a claim rises with age. Smoking is the next biggest: smokers typically pay around 60% more than non-smokers for identical cover, and premiums usually fall back to non-smoker rates after 12 months smoke-free.

Cover amount matters too, but not proportionally — the cost per £1,000 of cover falls as the total sum assured rises, so doubling your cover doesn't double your premium. Health and lifestyle factors such as BMI, blood pressure, cholesterol, family medical history and occupation can all move your quote up or down from the standard rate, and policy term and type (level, decreasing or whole of life) also change the price significantly, as shown above.

Before buying a policy, check whether your employer already provides death-in-service cover — many workplace pension schemes include this automatically, commonly paying out around 3 to 4 times your annual salary tax-free to your family if you die while employed there.

If it covers most or all of what you need, you may only need a smaller top-up policy — or none at all. Just remember that death-in-service benefit is usually tied to your employment, so it disappears if you change jobs, which is why many people also want a personal policy that stays with them regardless of who they work for. Use the "savings & existing cover" slider in the calculator above to deduct any death-in-service or existing policies from your suggested cover figure.

A joint life, first death policy covers two people under one plan, but pays out only once — on the first death — after which cover ends entirely, leaving the survivor to apply for fresh cover, now older and at a higher premium.

Two single-life policies typically cost only around 10% to 15% more in total than one joint policy, but each pays out independently — so if both partners were to die together, for instance in an accident, both claims would pay. For most families with an ongoing mortgage, that extra protection for a relatively small extra cost makes two single policies the sounder choice.

By default, a life assurance payout usually forms part of your estate for Inheritance Tax (IHT) purposes, which can push a modest estate over the nil-rate band and create an unexpected tax bill for your beneficiaries — potentially at 40% on the amount above the threshold.

Writing your policy in trust is a common and often free way to avoid this: the payout goes directly to your chosen beneficiaries outside of your estate, is usually paid faster (since it avoids probate), and stays outside any IHT calculation. This is particularly relevant for whole of life policies used for estate or inheritance tax planning. Setting up a trust is usually straightforward through your insurer at no extra cost, but the rules can be complex, so it's worth getting advice from a solicitor or financial adviser for larger or more complicated estates.

Say you're 35, earning £35,000 a year, with an outstanding mortgage and other debts totalling £220,000, and £10,000 of savings. You want to replace your income for 15 years and include the average funeral cost.

Adding it up: £220,000 of debts, plus £525,000 of income replacement (£35,000 × 15 years), plus £4,700 for a funeral, minus £10,000 of savings, gives a suggested cover amount of around £739,700. Over a 20-year level term as a healthy non-smoker, the calculator estimates a monthly premium of roughly £30–£35.

Switch to decreasing term instead of level, and the estimated premium falls by around a third for the same starting cover, since decreasing term is priced against an average balance that reduces over time. If you have a partner also relying on that income, two single policies would add only around 10–15% to the combined premium — a small price for both of you to be independently covered. Slide your own figures into the calculator above to see your own numbers.

Official sources & further reading: read guidance at MoneyHelper, check regulated firms on the FCA register, and see IHT thresholds on GOV.UK. Browse every tool on the mortgage calculators homepage.