Guide
Can you have more than one life insurance policy?
Life insurance is an excellent way to help support your family financially when you die. It gives your loved ones a lump sum when you pass away or if you’re diagnosed with a terminal illness. So, you’d think that multiple policies means your family is even more protected. But can you get more than one life insurance policy?
The short answer is yes. In the UK, you can take out as many life insurance policies as you like. And with as many different insurance companies as you like. However, having multiple policies may not be the best solution for you. And there’s normally a ceiling to the total payout you can receive from multiple policies.
In this guide we take a look at why you may need more than one life insurance policy. We cover the pros and cons of having multiple policies and whether it affects making a claim.
Do you need more than one life insurance policy?
For many people, having just one life insurance policy is enough to meet their family’s financial needs. Plus, many insurance policies have some built-in flexibility.
This allows you to change your existing policy as your circumstances change. For example, increasing your cover when you get married, or when you take on a larger mortgage.
But there are several other situations when you might consider taking out an additional policy. We take a look at some of them here.
Why you might want more than one policy?
You feel you don’t have enough cover. | For example, you may have cover for your repayment mortgage but not to provide a financial safety net for your family. So, although you already have a decreasing term insurance plan, you may want to add another life insurance policy. Your family can then use this money to replace your lost income or funeral costs. |
You take on more financial commitments. | You may decide to send your children to private school or start your own business. Whilst a regular income is coming in, you can cover all the expenses. But if you died, the money from an additional insurance policy can help your loved ones pay everyday bills without worrying. |
You want more comprehensive cover. | Joint life insurance usually ends on the death of the first person. This leaves the remaining partner without any cover. Instead, you can take out cover that ends on the death of the second life. Alternatively, you can have two separate policies. Then each partner gets to decide how much cover they need. |
You change employer. |
If your new employer doesn’t offer a death in service payment, you could take out your own life insurance policy to provide cover. |
You need a different type of cover. | You may already have insurance to pay off your mortgage if you die. But what about if you can no longer work because of illness or injury? Income protection insurance provides a tax-free monthly income if you can’t work. |
Cheaper premiums. | If you’ve improved your health and lifestyle, you could find that your premiums are now cheaper. For example, if you’ve given up smoking. Taking out a new policy could help you reduce your costs. |
Pay an inheritance tax bill. |
Whole of life cover guarantees to pay out whenever you die. If you put the plan in trust, it can be used to pay any inheritance tax. This is because the tax-free payout doesn’t form part of your estate so doesn’t count towards your overall inheritance tax bill. |
The benefits of multiple life insurance policies
There are many benefits to having more than one life insurance policy.
- Peace of mind. Two or more insurance payouts could not only pay off your mortgage but cover day-to-day expenses for your family.
- Cost. If your partner has health or lifestyle concerns, you may find it’s cheaper to take out two separate policies rather than one joint one.
- Flexibility. Multiple policies allow you to adjust your cover to your changing circumstances over many years. You can take out several insurance policies for different amounts over varying time frames.
- Meet a specific need. You can have different life insurance policies for different circumstances. Such as paying off your mortgage, covering day-to-day living expenses and protecting your income.
- Meet a financial goal. Life insurance can help you cover an inheritance tax bill, so the majority of your estate can be left to your family. It can also help you leave enough to pay for your funeral.
The disadvantages of multiple life insurance policies
There are a few things to think about before you decide to get more than one life insurance policy.
- Cost. The more cover you have, the more it will cost. Make sure you can afford the premiums for as long as you need the cover to last.
- Administration. Multiple policies means more paperwork. Especially if they’re with separate insurers.
- Check the maximum payout. If you have multiple policies with one insurer, you may find they have a maximum amount they’ll pay out across all your policies. With Vitality, this amount is £18 million, so more than enough for most people.
- Overinsured. Do you actually need the level of cover you’ll have with multiple policies? For some insurers, high levels of cover are a red flag. You may need to explain why you need this level of cover.
- Full disclosure. When you take out an additional policy, you’ll need to let the insurer know about any existing policies. And they’ll ask about your current health and lifestyle.
Can you claim on more than one life insurance policy?
When you have multiple insurance policies in place, you can claim on all of them. Once your application has been accepted, the plan is up and running. So, no matter how many plans you have, as long as they are active, you can make a claim.
If you have policies with several providers, you’ll need to make a claim with each different provider. Make sure your loved ones know where to find the policies, so they know who to make a claim with if you die.
Making a claim for life insurance is usually straightforward. It’s useful to have the plan number and the name of the deceased to hand when you call or email.Vitality life insurance
Want to know more about life insurance or thinking about taking out a policy? Here are some of the benefits of taking out life insurance with Vitality:
- A brand you can trust - In 2023, we paid out 99.7% of life insurance claims.*
- Get a lower monthly premium upfront when you add Optimiser to your plan. Keep your premiums low when you stay active.
- Access to Vitality partner discounts and rewards.
- Get free no-obligation advice. Our advisers offer expert advice to help you make the right decisions.
Multiple life insurance FAQs
Can you have 2 types of life insurance?
Yes, you can choose two or more types of life insurance. For example, you may already have mortgage protection insurance in place to cover your mortgage if you die. Then if you have children, you may want to take out a separate policy that provides for them until they reach adulthood.
What is it called when you have multiple insurance policies?
There’s no ‘official’ term for someone who has multiple insurance policies. It sometimes may be called dual insurance, or concurrent insurance if the policies provide the same cover over the same time frame.
How many over 50 life insurance policies can you have?
Just like any other life insurance policy, you can have multiple over 50s life insurance policies. But remember, you’ll need to pay the premium for each one right up until you die, or until the age the insurer stipulates in their conditions.
What is the maximum amount of life insurance?
The maximum amount of life cover Vitality offer is £18 million. But it makes sense to only pay for the amount you need. Think about the amount you’ll need to repay your mortgage, cover the costs of raising your family and any debts you may have.
Can you have a combined life insurance policy?
Most insurers offer a joint life insurance policy that covers both you and your partner. If you want to have life insurance with income protection or serious illness for example, they’ll usually be sold as separate policies.
Relevant guides and articles
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Is it worth having life insurance?
If you’re thinking about getting life insurance but not sure if it’s worth it, this guide can help you decide. We look at the benefits of life insurance.
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What is mortgage protection insurance?
Explore what mortgage protection insurance is and how it works. This guide covers the benefits of having mortgage insurance. Find out why this cover is important for homeowners.
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Life insurance and inheritance tax
In this guide, we will explain inheritance tax and the inheritance tax threshold and how to use a life insurance policy to pay an inheritance tax bill.