Joe Davine

Review of NFU Mutual Life Insurance

NFU Mutual offer a wide selection of life insurance policies, including Whole of Life, Term Insurance with Critical Illness, Term Insurance, and Family Income Benefit options. With this range, you’re likely to find a policy that fits your needs, and the company’s record for customer service certainly makes them worth considering if looking for a life insurance policy.

All of NFU Mutual’s policies are provided through AIG, meaning your life insurance will be backed by a name you can trust. So, let us take you through what NFU Mutual have on offer.

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Pros
  • Terminal illness cover
  • Choice of 4 different types of cover
  • Available on a range of different terms from 3 to up 70 years as well as whole of life
  • Joint policies are available
  • Discounts in premiums when renewing policies
  • Flexible policies
Cons
  • Cheaper plans have limited coverage
  • Have to call or go into a branch to get a quote

About NFU Mutual

NFU Mutual was formed in 1910, originally under the name Midlands Farmers Mutual Insurance Society Ltd. The purpose of the society was to drive up the membership of the National Farmers Union, and was the brainchild of 7 local farmers who founded it. The majority of policies are provided through a network of agents largely based in rural areas, so it can be slightly harder to take out a policy if your nearest office is far away.

The company began offering life insurance in the 1920s, but it wasn’t until the 1980s that NFU Mutual started offering products outside of the farming industry. Now over half of their policies are provided to those outside the farming community, and NFU Mutual underwrite over £1 billion of insurance products in the UK.

NFU life insurance options: our honest breakdown

The first choice you are faced with when looking at this company’s life policies is around which type of life insurance to get quoted on. The different NFU life policies are Whole of Life, Term, Term with Critical Illness and Family Benefit.

These all offer different types of cover to meet varying needs. Whole of Life will pay out on death at any time. Term will pay out a lump sum on death or diagnosis of terminal illness during the chosen term, and Term with Critical Illness offers the same with the addition of a payout if diagnosed with a critical illness during the term. Family Benefit pays surviving family members a monthly income following death of the insured person.

Terms and premiums vary from one type of policy to another and depending upon your own circumstances. If taking out a term policy, you can choose between level and decreasing cover to suit your needs. Quotes can be obtained directly from the NFU call centre or from a local branch.

The exact choice that you make will largely depend upon what you need to cover for. If you want a policy that will definitely pay out, then Whole of Life gives this assurance, but also tends to come with higher premiums. Term policies are generally ideal for covering a specific loan or expense, or making sure your family is covered if the worst were to happen in a specific time period.

Here’s a breakdown of the specific policies offered by NFU Mutual:

Term

Term life insurance is cover that you take out for a set length of time and will pay out if you either die or are diagnosed with a terminal illness during the policy period. NFU Mutual give a very level of flexibility for how long this term can be (3-70 years), meaning it’s easy to get covered for a length of time that suits your needs.

With NFU you can take out term life insurance either level, decreasing, or increasing tem cover. With both level and decreasing policies your premiums remain the same, but with decreasing term, the cash payout reduces over time, whereas it stays fixed with a level term policy. Increasing term cover means your cash benefit rises by 5% each year, but your premiums also rise, often at a higher percentage than the benefit.

  • Terms can be set between 3 and 70 years.
  • Cover must end before 90th birthday.
  • Pays out if critical illness diagnosed during term (with a life expectancy of 12 months or less).
  • Can be taken out as a single or joint policy.
  • Level, decreasing, and increasing term available.

Term with Critical Illness

NFU Mutual’s Term with Critical Illness policy is very similar to their Term cover, with (as you might expect) the addition of critical illness cover. The premiums for this policy will be significantly higher than regular Term cover, and the length of the term you can choose is also lower. Here are the specifics:

  • Term can be set between 3 and 50 years.
  • Cover must end at a maximum age of 86.
  • Terminal illness cover included (pay ut if you are diagnosed with less than 12 months to live).
  • Pays out either the whole cash benefit or a percentage if diagnosed with a critical illness listed in the policy (size of payout depends on the severity of the condition).
  • Level, decreasing, and increasing term policies available.

Family Benefit

Instead of paying out a one-off cash sum in the event of your death or being diagnosed with a terminal illness, this policy provides your family with a monthly income until the end of the term of the cover. Like with NFU Mutual’s other term options, this policy can be taken out as level, decreasing, or increasing cover.

  • Term can be set between 3 and 70 years.
  • Available to people between 17 years and 86 (ending at a maximum age of 90).
  • Can be a level, decreasing, or increasing term policy.
  • Terminal illness diagnosis triggers pay-out when less than 12 months to live.
  • Pays out in monthly instalments to your family rather than as one cash lump sum.
  • If you die or are diagnosed with a terminal illness, then your family will receive a monthly payout running until the end of the policy term.

Whole of Life

With a whole of life policy (commonly known as life assurance), your policy is guaranteed to pay out upon your death. There is no maximum length of term, your policy lasts as long as you keep paying the premiums. This policy can be taken out as level or increasing cover. With level cover, the policy payout is fixed, whereas with an increasing policy, your benefit will rise with the Retail Prices Index (RPI) up to a maximum 10%.

  • No term, policy lasts for life.
  • Available for UK residents aged 17-84.
  • Premiums continue until the end of the policy.
  • Joint and single policy options available.
  • Pays out on terminal illness diagnosis (12 month life expectancy or less).
  • Level and increasing cover available.

NFU Mutual: conclusion

NFU mutual offer a good range of products, and the flexibility of the length of their term options means that policies can be found to match anyone’s requirements. All their life insurance policies are provided through AIG, so you can be secure in the knowledge you’re dealing with a name you can trust.

All NFU Mutual policies also have flexible options in terms of the way policy payouts work. Being able to take out level, decreasing, or increasing term policies (and level or increasing whole of life cover) gives you a lot of choice. It is worth noting with increasing cover, however, that your premiums are likely to rise at a higher rate than your cash benefit, so it’s important to read the small print.

As NFU Mutual is run through its network of agents, to get a quote you’ll have to call them or go into your local branch. This can make the process take slightly longer, and it means it’s hard for us to give accurate estimates of the premiums and payouts you can expect, but does also mean you’re likely to end up with guidance to the right policy for you. If you like the look of NFU Mutual’s policies, click below to start the process of getting a quote.