Term Life Insurance.
The most coverage for the least money. For most families with a mortgage and children at home, term life is not the compromise option, it is the correct one.
Term life covers you for a defined period, commonly ten, fifteen, twenty, or thirty years, and pays a tax-free lump sum to the people you name if you die during it. There is no cash value and no investment component, and that is precisely why the premium is a fraction of what permanent coverage costs. You are buying protection during the years when your death would be financially devastating, and nothing else.
What would have to happen the month after
Most people approach this backwards. They ask what a policy costs, choose a number that sounds substantial, and move on. The useful question is narrower and considerably more uncomfortable.
If you died next month, what would your household actually have to do? Not in principle, specifically. Would the mortgage be paid, or would the house have to be sold in a difficult year? Would a spouse who works part time have to work full time, and who would then collect the children? Would university become a loan rather than a plan? Would anyone have to decide between grieving and going back to work in a fortnight?
Every one of those outcomes has a price, and the sum of them is the amount of coverage you need. That is the whole calculation. It is also why a policy sized by a rule of thumb is so often wrong in both directions, too little for a young family with a large mortgage, too much for someone whose children left a decade ago.
What coverage do I need, and what does it cost
These are the two questions everyone arrives with, and they are usually answered with a multiple of salary. Build the figure from the four pieces instead, then let us price it properly.
Build the figure yourself, in a minute
Six numbers, no personal details. Move the sliders and watch the answer build from the four pieces rather than a multiple of your salary.
Group cover through work usually ends with the job, so count it cautiously in that last figure.
A starting point, not a verdict. Income replacement here is undiscounted, which is deliberately conservative.
Priced across 52 carriers. No cost, no obligation.
How much coverage, honestly
The common shorthand is ten to twelve times income. It is a reasonable opening estimate and a poor final answer. Build it from the four pieces instead.
Debt that would remain
The mortgage first, because it is the largest and the most emotionally loaded. Then car loans, credit balances, any business debt personally guaranteed. This is the part that determines whether the family keeps the house.
Income to be replaced
Not your whole salary forever, the years until the household could stand alone. A spouse with children at school needs a longer runway than one whose children are grown. Be specific about the number of years.
Costs that arrive because you died
Final expenses, an estate to settle, and possibly childcare that you were providing for free. A non-earning parent frequently needs substantial coverage for exactly this reason, and is frequently uninsured.
Goals you promised
University, a wedding, a business you intended to hand over. These are the pieces people leave out and the ones families notice most.
Then subtract what already exists: savings, existing coverage, a spouse’s earning capacity, and any group policy through work, remembering that group cover usually ends with the job. The remainder is what to buy.
How long, and why the answer is usually longer
Choose the term by the date your obligations end, not by the premium. The two mistakes are almost always in the same direction: too short.
Match the mortgage
If twenty-two years remain, a twenty-year term leaves two years uncovered at exactly the age when new coverage costs most. Round up rather than down.
Match the children
Count to the year your youngest is genuinely independent, then add a margin. Parents of a newborn frequently need thirty years, not twenty, and the price difference at a young age is smaller than people expect.
Consider your own retirement
If a spouse would depend on your pension or earnings until you retire, the term should reach that point. Coverage ending five years early is a gap, not a saving.
Laddering, when it fits
Two or three policies of different lengths and amounts, so coverage steps down as obligations fall away. It costs less overall than one long policy at the full amount, and it suits a household with a clear timeline.
The reason to err long is medical rather than financial. Renewing a policy at sixty is priced at sixty and underwritten at sixty, and by then, most people have something in their history that they did not have at thirty-five.
The mistakes that cost families most
None of these are unusual. We see all six regularly, and every one is avoidable in a conversation that takes twenty minutes.
Relying on coverage through work
Usually one or two times salary, well below what a household needs, and almost always tied to the job. Leave, and it goes, at whatever age and health you are then. Keep it, and own something personally alongside it.
Insuring only the earner
If a non-earning parent died, someone would have to be paid to do what they do, or a career would have to change. That is a real cost and it is routinely left uninsured.
Waiting for a better time
Premiums rise with every year of age, and health rarely improves on a schedule. The rate available today is the best rate you will ever be offered. Waiting is a bet, not a plan.
Choosing a term by price
A shorter term is cheaper because it protects you for less time. If it expires while the mortgage is still outstanding, it did not solve the problem, it postponed it to the worst possible moment.
Not naming beneficiaries properly
An out-of-date beneficiary, or a minor named directly with no arrangement in place, causes delay and sometimes goes to the wrong person entirely. It takes minutes to get right and years to regret.
Assuming a condition disqualifies you
Diabetes, treated depression, a cancer history, a cardiac event, carriers view all of these very differently, and the same file can be Standard at one and declined at another. Never conclude on your own that you are uninsurable.
What actually happens when you apply
It is less onerous than most people assume, and it has changed considerably in the last few years.
Frequently no medical exam. Many carriers now issue meaningful coverage using prescription history and other records rather than bloodwork, sometimes with a decision in days. What qualifies varies by carrier and changes, and there is a genuine trade-off, if you are in good health, letting them see good numbers often prices better.
Underwriting looks at more than health. Age and tobacco drive the most, then build, family history, occupation, hazardous hobbies, driving record and any history of international travel. Carriers weight these very differently, which is the entire argument for going to more than one.
Answer everything accurately. Omitting a condition does not protect you, it hands the carrier grounds to contest the claim during the first two years, which is exactly when a young family can least afford a dispute. A disclosed condition placed with the right carrier is worth vastly more than a hidden one placed anywhere.
We are appointed with 52 carriers in life, which matters most in exactly the cases where it is hardest to get a good offer. The case gets placed where it is viewed most favourably, rather than wherever an agent happens to be contracted.
Would the mortgage be paid?
If the answer is no, everything else about the household changes in the same month, the school, the neighbourhood, the job a spouse can accept. It is the single question that decides how much coverage is enough.
Work it out with me →Term life, answered plainly
How much do I actually need?+
Build it rather than guess it. Debt that would remain, income to be replaced for a defined number of years, costs that arise because you died, and goals you promised, then subtract savings, existing coverage, and a spouse’s earning capacity. The remainder is the amount. Ten to twelve times income is a starting estimate, not an answer.
What happens when the term ends?+
Coverage stops. Most policies allow renewal at a much higher price, and many allow conversion to permanent coverage without new medical questions, which is a valuable feature worth confirming before you buy. The better plan is to choose a term that outlasts the obligation in the first place.
Is term life wasted money if I outlive it?+
You could say the same of any year your house did not burn down. What you bought was certainty during the years when your death would have been financially catastrophic, at the lowest price the market offers. Outliving it is the outcome everyone wants.
Do I need a medical exam?+
Often not. Many carriers now issue substantial coverage with no exam and no bloodwork, using prescription and other records, sometimes deciding in days. If you are in good health, an exam frequently prices better, so it is worth pricing both routes rather than assuming.
Is the payout taxable?+
A death benefit paid to a named beneficiary is generally received income-tax free. Estate treatment is a separate question and depends on ownership and the size of the estate, which is genuinely a conversation for an advisor alongside a tax professional rather than something to settle here.
I have coverage through work. Is that enough?+
Take it, and treat it as a supplement. It is typically one or two times salary, which is well below household need, and it is almost always tied to the job, so it disappears at whatever age and health you are when you leave. The usual answer is to keep it and own something personally.
Can I get covered with a health condition?+
Frequently yes, and this is where carrier breadth decides the outcome. Diabetes, treated mental health conditions, a cancer history and cardiac events are all viewed very differently across the market, and several carriers will improve a rating for well-controlled conditions. What we cannot tell you is your class, only the carrier decides that.
Should I cancel my old policy if I find something better?+
Not before an advisor has read both. Replacement is regulated for good reason, you can give up coverage you would no longer qualify for, or restart a contestability period you had already cleared. Sometimes the right answer is to keep it and add. Never cancel first.