Younger adults are locking in significantly lower life insurance premiums than older age groups, while demand for critical illness and joint policies continues to build, according to a new five-year analysis of Confused.com's life insurance data.
According to the analysis, the average monthly life premium across all age groups in 2025 was £27.
For 18- to 24-year-olds, the average was just £12 a month, compared with £48 for customers aged over 55 years, a £36 differential that the comparison site said illustrates the value of buying cover early. Premiums for term life are typically fixed at outset, meaning younger buyers can secure these lower rates for the duration of the policy, unless they later change key details, such as benefit level or term.
Over the past five years, average premiums for 18- to 24‑year‑olds have fallen by 5%, for 25- to 34‑year‑olds by 12%, and for 35- to 44‑year‑olds by 6%. By contrast, 45- to 54‑year‑olds have seen premiums rise by 13% since 2020, while over‑55s have experienced a 38% increase, reflecting higher age‑related mortality risk and the impact of inflation on required sums assured.
Moreover, men are paying more than women on average, at £340 a year versus £309, in line with industry experience that men tend to have higher mortality risk profiles in many age bands.
Persistent protection gap despite rising volumes
Despite relatively low entry‑level pricing for younger adults, Confused.com estimated that around two‑thirds of UK consumers (66%) do not have any life insurance in place. Industry‑wide research pointed in the same direction. The Association of Mortgage Intermediaries’ July 2023 study of 3,000 adults found that only 32% held life insurance, 11% critical illness and 7% income protection, while FCA Financial Lives data for 2022 put life cover penetration at just 29%.
That protection gap persists even as overall protection activity remains significant. Association of British Insurers (ABI) figures showed 2.1 million individual protection contracts – spanning term assurance, standalone critical illness, income protection, whole of life, relevant life and business protection – were sold in 2023, although this was the lowest volume since 2018 as mortgage‑related term sales dipped alongside a weaker housing market.
However, more recent distribution data suggested momentum has returned. iPipeline reported that the UK protection market entered 2025 “on a strong footing”, with Q1 2025 annual premium equivalent up 17% year‑on‑year and new business volumes 4% higher than in Q1 2024, led by growth in level and decreasing term, multi‑benefit and underwritten whole‑of‑life policies.
Critical illness cover moves up the agenda
The study also indicated that 20% of its life policies sold in 2025 included critical illness cover, an 11-percentage-point increase since 2020.
One in five women (20%) added critical illness cover last year, compared with 16% of men. Over the past five years, 11% of 18 to 24-year-olds have included critical illness cover, versus an average of just 2% among over-55s, suggesting younger policyholders are more willing to buy combined life and illness benefits than older cohorts.
Those patterns align with ABI market data, which showed 75,700 standalone critical illness policies were sold in 2023, up 7% on 2022 and almost four times higher than a decade ago. The latest ABI payout statistics indicated the average critical illness claim in 2024 was £67,600, with total critical illness payouts reaching £1.3 billion, 5% higher than 2023. More than 89% of critical illness claims were paid, with cancer continuing to account for the majority of cases.
Across all individual and group protection lines, the ABI and Group Risk Development (GRiD) report that insurers paid a record £8 billion in combined protection claims in 2024 – underlining the scale of benefits being delivered even as coverage gaps remain.
Joint policies gain traction, but design questions remain
Meanwhile, the average monthly cost of a single life policy last year was £28, compared with £26 for a joint policy.
While single‑life cover accounted for 74% of policies between 2020 and 2024, the proportion opting for a single policy fell by 63% in 2025 as more couples chose joint cover for perceived cost savings and simplicity. Almost half (44%) of male customers selected a joint policy over a single one.
The average sum assured across Confused.com’s book currently stands at £168,318. With the UK average house price at around £285,000 in late 2024, that level of cover will typically clear a substantial share of a mortgage but may be less adequate for households also seeking to replace income and fund dependants’ needs over the long term.
The data suggest clear pricing advantages for early engagement and growing interest in bundled life and critical illness benefits, but also highlight persistent under‑insurance and the risk that joint first‑death policies, while cheaper, may leave surviving partners without ongoing cover after a single claim.
