Level vs Decreasing Term Comparison
Level vs Decreasing Comparison
Level Term Monthly-
Decreasing Term Monthly-
Monthly Saving (decreasing)-
Level Cover at Year 15-
Decreasing Cover at Year 15-
Total Cost (Level)-
Total Cost (Decreasing)-
Level vs Decreasing Term Comparison
| Feature | Level Term | Decreasing Term |
|---|---|---|
| Cover Amount | Stays the same | Reduces over time |
| Monthly Premium | Higher | 30-40% cheaper |
| Best For | Income protection, interest-only | Repayment mortgage |
| Flexibility | More flexible | Less flexible |
| End Value | Full cover | Near zero |
Key Facts
Decreasing Saving
30–40%
Tax-Free Payout
Yes
Write in Trust
Recommended
How to Use This Calculator
1
Enter your age
Premiums increase significantly with age for both policy types.
2
Enter cover amount
The amount you want to insure. For decreasing term, this is the starting cover.
3
Enter policy term
Match to your mortgage term or the period you need cover.
4
Select smoker status
Smokers pay significantly more for both policy types.
5
Compare the results
See monthly premiums, total costs and cover levels at year 15 for both types.
Frequently Asked Questions
When should I choose level term?
Choose level term if: you have an interest-only mortgage, you want family income protection, you want maximum flexibility, or your cover needs will not reduce over time.
When should I choose decreasing term?
Choose decreasing term if: you have a repayment mortgage and want cover to match the reducing balance, you want the cheapest possible premiums, or your main purpose is mortgage protection only.
Can I convert decreasing to level?
Generally no. Once a policy is in force, you cannot change the type. You would need to take out a new level term policy, which may cost more due to increased age and potential health changes.
What about joint life policies?
Joint life policies cover two people and pay out on the first death. They are cheaper than two separate policies but only pay out once. After a payout, the surviving partner has no cover and may be older and harder to insure.
Is critical illness cover worth adding?
Critical illness cover pays a lump sum if you are diagnosed with a specified critical illness. Adding it to life insurance increases premiums by 40-80% but provides valuable protection. Consider whether you have other cover through your employer.
Should I get life insurance through my mortgage lender?
Your mortgage lender may offer life insurance but you are not obliged to buy from them. Independent comparison usually finds cheaper premiums. You have the right to choose any provider.
Official Sources & References
Data verified against official UK government sources. Last checked April 2026.