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Can you change life insurance?

In this page we break down whether you can change your life insurance policy, how to do it, and what you can change

A photo of Daniel Sharpe-Szunko, the author

By Daniel Sharpe-Szunko

Published on: 30 January 2023

6 min read

Can you change life insurance? 

Another very common financial question that people ask is can you change life insurance? It’s not surprising that this question comes up because life insurance is not exactly something that we deal with regularly. 

In this section we look at the answers to can you change life insurance and what are the options that you’ve got. There are many different elements to a life insurance policy and you will probably have a lot more flexibility than you think. In our independent reviews, we’ll explain how things work and what your options might be. 

Question: Can you change life insurance? 
Answer: Yes, you’ll usually have lots of options in your existing life insurance or the fact is that you’re not tied in to life insurance so you can also cancel cover and change to another policy or provider. 

What options do you have to change life insurance? 

Most life insurance policies are a lot more flexible than policyholders think and often there are many things you can do. 

Some insurance providers will offer different options to others and your options may vary depending on your health for example. There are also some standard options that will automatically be included with your policy. 

Here are some of the most common things that you can change and the most common reasons for people changing their cover. 

Change your cover amount

Yes you should be able to change the amount of cover in most circumstances but there may be restrictions to this. You should speak to your insurer for more information about this option, also known as Guaranteed Insurability. 

Reduce the amount of cover 

There are usually options to be able to reduce the amount of cover (sum assured) on your life insurance policy. In most circumstances you shouldn’t need to answer any additional medical questions and you won’t need to provide medical evidence. 

Reasons why you might want to reduce your life insurance: 

  • Paid off some or all of your mortgage 
  • Children are older (less dependent) 
  • Divorce 
  • New job 
  • Inheritance 

If your application was underwritten because of your medical history then you might not have this option. Some insurers might not give you the option to reduce your cover if you have a pre-existing medical condition, high risk occupation, or dangerous activity. 

If you are struggling or if you need help then you can contact our preferred independent life insurance experts for advice. 

Increase the amount of cover 

One of the most common changes is where a policyholder wants to increase their cover during the term of the plan. There are usually options to increase your life insurance during the term of your cover which is also part of the Guaranteed Insurability option. 

Reasons why you might want to increase your life insurance: 

  • Increase your mortgage 
  • More debt or credit 
  • Birth or adoption of a child 
  • Getting married 
  • New job or change of earnings 
  • Starting a business 

With most existing life insurance policies, you have a number of options available to you and several potential limitations. Your guaranteed insurability options for increasing cover will vary depending on your insurance provider and the terms of your cover. 

Here are some of the main points to consider when increasing your life insurance: 

  • Maximum increase (usually 50% of the original sum assured) 
  • Maximum number of increases (usually 3 increases per plan) 
  • Amount of increase (£150,000 to £250,000 subject to insurer T&C’s) 

You might also not be able to increase or change your cover amount if your application was accepted on ‘special terms’ (e.g. medical conditions, occupations or activities). It’s best to start by checking your insurance policy documents or you can contact your insurance provider for more information. 

Common reasons for changing your life insurance 

There are many things that will happen and change in your life throughout the term of your life insurance policy. We take out cover for very long periods of time (usually 15 to 30 years), so it’s almost impossible to predict how your life might change in this time. 

You should definitely review your life insurance regularly and especially if there has been a major change in your circumstances. 

Most common reasons for reviewing life insurance 

New born child or adopting a child – life insurance is specifically designed to help parents to protect their children if they were to lose a parent. There are huge financial implications for any family that loses a parent or a main breadwinner in the household. 

Getting married – couples will often tie the knot at some point in their relationship and usually this has legal and financial implications. It is often understandable to want to protect your partner if you were to die and provide for their future. 

Divorce or separation – statistically it is increasingly likely that a marriage or a relationship will break down at some point. This can also have legal and financial implications for a couple and their family, especially for those with children to consider. 

Can I cancel life insurance? 

Yes, you can cancel your life insurance at any point during the term of your policy and without penalty or charges. 

Some of the main things to think about when cancelling your life insurance: 

  • Do you have a replacement policy in place? If you’ve not already been offered cover then you might be able to switch your life insurance without a break in cover and without the risk of leaving your family unprotected. 
  • Will you lose your existing terms? If you’ve got cover in place that has been underwritten and your health has changed, it might be best to keep your existing policy and potentially look at a top-up. 
  • Are you at risk if you cancel your life insurance? One of the biggest considerations when cancelling life insurance is, will this leave my family at risk or unprotected. Sometimes we cancel direct debits without proper thought and other times we might react to a situation without considering the implications. 

There are a couple of ways to cancel your life insurance and often you’ll be notified that your cover will cease. Here are the main ways to cancel your life insurance and some of the options that you might have. 

  • Cancel your direct debit with your bank or building society 
  • Contact your insurer to cancel your cover 

Often you’ll have the option to re-instate your cover for up to 3 or 6 months after cancellation as long as you make up the missed premiums. 

Can I have more than one life insurance policy? 

Yes, there is actually no limit to the number of life insurance policies that a person can have and no real implications to having multiple policies. 

There are a number of reasons why you might want to have multiple life insurance policies, such as: 

  • Different types of cover (e.g. mortgage protection and family protection) 
  • Multiple insurers to spread risk 
  • More flexibility 
  • Change in future circumstances 
  • Avoid medical underwriting 
  • Financial limits 

You should also note that insurers don’t share medical records or any details about your policies. Therefore, your insurer won’t be aware of any other cover that you have and this shouldn’t have any implications with your other plans. 

Who can change my life insurance policy? 

The policyholder or the lives assured (if joint) should be the only person or people who can make changes to your life insurance. 

If someone tells you that they can change your life insurance for you then you should be very careful when speaking to them. Nobody can officially change your policy apart from you and if anything has changed then you should contact your insurer immediately. 

How often should I review my life insurance? 

There are a number of special events that might happen which can have an impact on your life insurance, as detailed above. 

Other than those, you should regularly review your life insurance to make sure that you’re paying the right amount. Life insurance premiums will usually increase as you get older so it is unlikely that cover might be cheaper, but not impossible. 

Some other reasons why you should review your life insurance: 

  • Quit smoking (premiums will reduce if you stop smoking) 
  • Change in health (if your health improves then you might get lower premiums) 
  • Occupation changes (lower risk jobs can reduce your premiums) 
  • Less high risk activities (stopping an activity can reduce premiums) 

There are no charges for changing or even cancelling your life insurance policies during the term of cover. 

Getting advice about changing your life insurance 

If you need help with how to change your life insurance or to speak to someone about your options, you can contact our independent life insurance experts. 

You can speak to an independent life insurance specialist who will be able to tell you what your options are and how to get the best outcomes. 

Resources

Scottish Business News – Interesting facts and figures about life insurance in the UK

Finder.com – Life insurance statistics

Statista – Life insurance industry in the UK: Statistics & Facts

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