Prudential Life Insurance Review 2025

The Prudential Group is a global insurance provider with a significant presence in the US, Asia, and the UK. They assist millions of customers worldwide with their life insurance and pension products.

Their life insurance policies are internationally recognized and trusted, known for their high payout rates.

What Types of Life Insurance Are On Offer?

Level Term Cover

With level term cover, both premiums and coverage limits remain constant. This means the payout amount will not change throughout your policy term. The lump sum you choose at the policy’s inception is the exact amount that can be claimed up to the policy’s expiry.

Decreasing Term Cover

Decreasing term cover is typically a more affordable option compared to level term cover. This is because the potential payout value reduces over the policy’s duration. If you intend to cover a financial obligation that decreases over time, such as a mortgage, this option might be suitable as your mortgage balance reduces over time. Essentially, with decreasing term cover, a chosen payout of £50,000 will decrease to nil by the policy’s expiry date.

Increasing Cover

Inflation can erode the real value of level term cover over time. If your coverage payout is fixed, £100,000 claimed in 20 years will have significantly less purchasing power than £100,000 at the policy’s start. Increasing cover addresses this by adjusting your coverage payout in line with the Retail Price Index. While your premiums will also increase, this helps ensure the payout maintains its real value relative to inflation.

Additional Cover Options

Critical Illness Cover: For an additional premium, you can significantly enhance your life insurance policy with critical illness cover. Standard life insurance covers death or terminal illness diagnosis. Adding critical illness cover allows you to claim a benefit amount (though typically less than the life policy payout) if you are diagnosed with a serious medical condition like a heart attack, stroke, or cancer. This can provide financial security to cover living expenses if you are unable to work due to a serious illness, until you recover and can return to work.

Waiver of Premium Cover: If you become unable to work due to illness or injury, this benefit covers your premiums. If you are too ill or incapacitated to perform your normal occupation, this cover, available for an additional premium, will pay your premiums on your behalf.

Life Insurance Features

• Provides a lump sum payout upon death or diagnosis of a terminal illness (subject to the provider’s policy wording and conditions).
• Offers the choice between single or joint policyholders.
• Typically involves minimum and maximum age limits for both applicants and claims.
• Often provides an immediate decision upon application for most potential policyholders.

Additional Benefits

We compare plans from the leading life insurance providers Compare quotes now

Many life insurance policies include extra benefits:

• Second medical opinion at no extra cost: Access to leading doctors for a thorough review of your diagnosis and medical case, providing expert advice and treatment recommendations.
• Free Will writing services.
• Contribution towards funeral costs (amount varies by provider).
• Option to place policy payout in trust, potentially protecting beneficiaries from inheritance tax on the life insurance benefit.

Why Might a Payout Not Be Paid?

• Inaccurate policyholder details provided during the application process.
• Self-inflicted injury or suicide within the first 12 months of the policy start date.
• For policies with Critical Illness Cover, the diagnosis must be for a defined illness listed in the policy document.
• Failure to maintain policy premium payments.

Defaqto Ratings

Defaqto ratings offer an independent way to compare financial products and insurance providers. Defaqto is a service that evaluates financial products, assigning them a star rating based on their features and benefits, with 5 stars being the highest rating. A Defaqto 5 Star Rating indicates that the insurer offers one of the highest quality products available in the market.

Advantages to Look For

• Flexible coverage options, with various Term Covers (Level Cover, Decreasing Term Cover, or Increasing Cover) to meet different policyholder needs.
• Significant coverage amounts suitable for providing appropriate financial security for you and your family.
• High payout rates for claims. Life insurance generally has a high claim payout rate.
• The option to choose between single or joint coverage can be a cost-effective way to protect both individuals in a partnership.
• Fixed monthly life insurance costs, aiding in long-term budget planning.
• Discounts for customers who already have other products with the insurer.
• Regulation by the Financial Conduct Authority. This ensures that in the event of company insolvency, eligible outstanding claims or payments will be covered by the Financial Services Compensation Scheme (FSCS), protecting customers financially.

Disadvantages to Look For

• Term limits. Policies that expire before the policyholder’s death mean that the policy might not ultimately provide a payout. Some insurers offer whole-of-life coverage, and some may allow for premiums to cease after a certain age (e.g., 90), while cover continues.
• Fixed premium cover can mean the real value of your policy payout decreases over time due to inflation. This could result in the payout’s value being less than the total premiums paid.
• Policies with no cash-in value: Cancelling the policy results in no return of premiums. Some life policies offer a cash-in value, potentially returning a percentage of premiums paid after a certain period.
• Potentially lengthy approval processes: This could leave you and your family unprotected for longer than necessary, while some providers offer quicker quotes and decisions.