Table of Contents
Originally published: 2018 | Last updated: September 2025
Life insurance is life insurance, right?
Well, no.
It would make far more sense if insurers offered one, simple, crystal-clear policy.
But sure look — insurers love a bit of complexity. So let’s decode it.
Put simply, there are two types of fixed cover (i.e. the sum insured doesn’t reduce over time — the one that does reduce is mortgage protection):
Pick a term and an amount of cover — say €500k over 35 years. Pay the premium during those years. If you survive the full term: you’re alive (class) but your cover ends. Well done, you’ve outlived your policy!
If you die within the 35 years, it’s not such good news for you, but your family gets €500k tax-free. 😆
That’s the deal. You’re essentially betting you’ll die during the term; the insurer is betting you won’t. #warped #dark
Joe Average example:
Quote Type: Life Insurance
First Person: Non-Smoker, born on 11/03/1990
Cover Amount: €500,000 paying monthly, over 35 years.
Let’s call it €45 per month.
Whole of life runs from policy start to the day you croak it. A payout is assured (provided you keep paying). But of course there are flavours. Because… insurance.
| Feature | Term Life | Whole of Life |
|---|---|---|
| Duration | Fixed term (e.g., 20–40 years) | For life |
| Payout | Only if death occurs during term | Guaranteed (premiums must be maintained) |
| Monthly Cost (Joe Example) | ≈ €45 | Guaranteed WOL ~ €404; options vary |
| Flexibility | Conversion option available (cost recalculated at future age) | Some plans offer cashback or “paid-up” options |
| Best for | Keeping premiums low during working years | Leaving a guaranteed lump sum / covering funeral costs |
This is the Galaxy Caramel of life cover. It runs for life, premiums are fixed from day one, and there are no policy reviews creeping up to fleece you at 85.
It will eventually make your family rich (all they need is just a little patience)
Joe Average quote:
Approx €404 per month for €500,000 guaranteed payout.
How can the insurer profit?
Easy — invest monthly premiums at a high rate for those 60 years and rely on human behaviour (lots of people cancel before claim). Grim, but true.
Add the Life Changes option and, after 15 years, you can either:
Costs about +10% extra.
For Joe’s €500k example, that’s ~€444/month. More here: Life insurance with Cashback.
The Maltesers Teaser of whole of life. It doesn’t literally pay for itself, but set up right it can pay out more than you paid in.
Joe’s setup:
Term: €470,000 over 35 years + Free Whole of Life: €30,000 → €70.30/month.
Over 35 years Joe pays €29,526; the minimum guaranteed payout is €30,000. Maths says: nice one.
More here: Whole of Life Insurance that Pays for Itself.
Big steaming pile of nope. Reviews every 10 years to age 60, then every year. Premiums can jump — not a cheeky fiver — think hundreds of percent. It’s the loan shark of life cover: targets the vulnerable until they cancel and lose protection.
Full rant here (and worth a read): Beware of policy reviews.
If you want value during your working years and don’t need cover forever, Term Life is grand — add a conversion option for flexibility (note: future premiums are based on your older age).
If you want a guaranteed payout and zero faff later in life, Guaranteed Whole of Life (or the Hybrid) is the business. Personally, I love the hybrid: decent term now, small guaranteed lump sum later. Also answers the age-old “do I get nothing if I outlive it?” worry.
Term life runs for a fixed number of years (say 20–35) and only pays out if you die during that time. Whole of life runs until you die, no matter when, so the payout is guaranteed — but the monthly cost is far higher.
Not necessarily. Whole of life guarantees a payout, which is useful for covering funeral costs or inheritance tax. But it’s expensive. For most people during mortgage and family-raising years, term life offers the best value.
Yes. Most policies include a conversion option, which lets you extend cover without fresh medicals. Premiums will still be recalculated at your older age, so expect them to be higher.
If you’re still scratching your head about which cover is best, don’t worry — that’s my job.
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