Barclays bank life insurance review

21 min Read Published: 12 Jan 2022

Barclays bank life insurance reviewWhile it might feel easier to buy your life insurance through your bank, the products can be limited and may not represent good value when compared to the best and cheapest life insurance products from the wider market. In this article, we take a look at what is covered under Barclays' life insurance and critical illness insurance products as well as how the prices stack up against the rest of the market which includes well-known insurance companies such as LV=, Scottish Widows and Aviva.

Barclays bank life insurance

Barclays life insurance is provided by Legal & General Assurance Society Limited which is one of the largest life insurance providers in the UK. Barclays Bank UK PLC and Barclays Bank PLC are authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Also, Barclays Insurance Services Company Limited is authorised and regulated by the Financial Conduct Authority (FCA).

Barclays life insurance provided by Legal & General is rated 3 stars by Defaqto meaning that the life insurance products provided are of average quality. Previously Barclays bank life insurance was provided by Aviva.

Types of life insurance you can buy with Barclays Bank

You can buy two types of life insurance from Barclays bank, namely mortgage life insurance and simple life insurance.

Barclays simple life insurance

Barclay's simple life insurance is provided by the insurance company Legal & General and can be used for a number of different purposes as it pays a tax-free lump sum of money if you die within the years that you're covered. For many customers, a Barclays simple life insurance policy can be used for family protection. Barclay simple life insurance is similar to a level term life insurance policy which is one of the most straightforward types of life insurance you can buy. It covers the insured person for a sum of money that remains the same for the number of years that you choose to be covered and if death happens within those years, the policy will pay out the insured sum of money.

You cannot include critical illness insurance with Barclays simple life insurance.

Barclays mortgage life insurance

Barclays life insurance for mortgage holders is designed to protect the money that you've borrowed in case you die before it is repaid. This type of life insurance ensures that if they die within the policy term, their home is protected and wouldn't have to be sold in order to repay the mortgage.

Barclays provide a choice of two types of mortgage life insurance; one that remains level and covers the same amount throughout the years that you will be repaying your mortgage over and the other is a decreasing life insurance where the amount that the life insurance covers reduces alongside your mortgage balance for a repayment type of mortgage so it only covers what is outstanding at the time of a claim.

You can include critical illness insurance with your life insurance so that, should you suffer a very serious illness there is a lump sum of money paid out that would help you to either reduce your mortgage balance or pay it off entirely. If there is a successful claim on the critical illness insurance part of the policy then the policy would cease, meaning the policyholder would no longer be covered in the event of death. The critical illness insurance pays out if you are diagnosed with one of the illnesses that is covered by the policy and your illness meets the definition of that illness as described by the critical illness cover terms.

Critical illness insurance

Critical illness insurance with Barclays is also provided through Legal & General and can only be purchased with a Barclays mortgage life insurance policy.

Critical illness insurance will pay out if you are diagnosed with one of the specific illnesses described in the cover terms and usually includes a definition of severity that has to be met for a claim to be paid.

What is included on a Barclays critical illness insurance policy?

Barclays critical illness insurance covers 40 different illnesses and conditions for full payment including:

  • Blindness
  • Deafness
  • Cancer
  • Heart attack
  • Kidney disease
  • Multiple sclerosis
  • Liver failure

You are also covered for two illnesses that will pay 25% of the insured value up to maximum of £25,000 and these are:

  • Carcinoma in situ of the breast
  • Low grade prostate cancer

Barclays critical illness insurance also includes children's critical illness that will pay 50% of the insured value up to a maximum of £25,000 if your child is diagnosed with a condition that is covered under the policy terms. There is also a children's funeral benefit that will pay up to £4,000 towards the cost of a funeral.

Childcare benefit and family accommodation benefit will provide money towards childcare and accommodation for your children if you are diagnosed with a critical illness.

Barclays terminal illness insurance (included with life insurance)

Barclays life insurance includes terminal illness insurance which allows the policyholder to make an early death claim if they are diagnosed with a terminal illness. Most terminal illness benefits require a confirmation from a medical practitioner that death is likely to happen within 12 months but Barclay's terminal illness insurance terms require your hospital consultant and Legal & General's medical officer to confirm this before a claim is approved.

How does Barclays life insurance work?

Barclays life insurance is a term life insurance policy which means that it covers the insured person's life for a specific number of years which you can choose. It will only pay out if death happens within the years of the policy and so there is no payout from a term life insurance policy if death happens after the policy term expires.

Who is Barclays life insurance suitable for?

  • Those looking for family protection - the life insurance payout can provide for ongoing household bills, childcare costs, school/university fees or any other financial needs your family may have if you were to die.
  • Those looking for mortgage protection - the life insurance payout can be used to either reduce a mortgage balance or pay it off entirely so that your home is protected in case you die before repaying your mortgage.
  • Those looking to protect their debts - life insurance can pay off any personal loans that would still need to paid in the event of your death.

Who is Barclays life insurance not suitable for?

  • Those looking for funeral cover - funeral costs can arise at any point of your life and if you wish to cover these, you will usually need a life insurance policy that covers you for the rest of your life so that your funeral is covered whenever death happens.
  • Those looking to fund a potential inheritance tax bill - inheritance tax is payable upon your death if the value of your estate exceeds your tax free personal allowance and because this can arise at any point of your life and term life insurance may run out before you die making it unsuitable for this purpose.

For life insurance that will pay out when you die regardless of what age that happens, you should consider over 50s life insurance or whole of life insurance policies. You can read more about these types of life insurance in our articles, "Which is the best over 50s life insurance?" and "Whole of life insurance - what you need to know"

Barclays bank life insurance cover calculator

Barclays' website has a life insurance cover calculator that helps you to work out how much life insurance you may need. The life insurance calculator asks a number of key questions that help to determine your life insurance requirements.

Barclays life insurance calculator helps you to get started by selecting the profile that best suits you and includes 'a person with no dependents', 'a person with one dependent' and 'a person with multiple dependents'. Alternatively, you can choose to build your own.

The life insurance calculator will gather information about your:

  • Assets
  • Spending
  • Future spending

The life insurance calculator will produce a sum of money that you should insure as a minimum and as a maximum using the information that you provide but also allows you to adjust this figure according to any specific concerns you may have.

Barclays simple life insurance policy summary

Policy Type  Simple life insurance
Amount of cover available: Up to £5,000,000
Policy length available: Between 5 and 50 years
Coverage: Single and joint life policies
Premiums: Fixed monthly premiums
Terminal illness included? Yes and defined as:

The illness either has no known cure or has progressed to the point where it cannot be cured and in the opinion of your hospital consultant and our Medical Officer (a qualified doctor employed by Legal & General), the illness is expected to lead to death within 12 months.

Minimum age at entry 18
Maximum age at entry 74
Maximum age at expiry 90
Includes: Free accidental death benefit that covers up to £300,000 for up to 90 days whilst your application is assessed
Exclusions: Suicide: If, within the first year of the policy, you die and your death is caused by suicide or intentional and serious self-injury, you won’t be covered

Barclays mortgage life insurance summary

Policy Type Mortgage life insurance
Amount of cover available: Up to £5,000,000
Policy length available: Between 5 and 50 years
Coverage: Single and joint policies
Types of cover Level and decreasing life cover available
Premiums: Fixed monthly premiums
Minimum age at entry: 18
Maximum age at entry: 74
Maximum age at expiry: 90
Extra benefits: Free life cover if you die between exchanging contracts and completing your property purchase – up to a maximum of 90 days
Includes: Free accidental death benefit that covers up £300,000 for up to 90 days whilst your application is assessed
Exclusions: Suicide: If within the first year of the policy, you die and your death is caused by suicide or intentional and serious self-injury, you won’t be covered

Barclays critical illness insurance summary

Policy Type Critical illness insurance
Amount of cover available: Up to
Coverage: Single life policies only
Illnesses covered: 40 full payment illnesses covered

2 additional payment illnesses covered

Premiums: Premiums are fixed and payable monthly
Minimum age at entry: 18
Maximum age at entry: 64
Maximum age at expiry 74
Includes:
  • Hospitalisation benefit
  • Terminal illness cover
  • Children's critical illness cover
  • Child funeral benefit
Exclusions: Incorrect information: If you don't answer our questions honestly and in full before your policy starts, we won’t pay out

Critical illnesses: We won't pay out your amount of cover if the policy includes Critical Illness Cover and you’re diagnosed with a critical illness that doesn't meet our definition

How much does Barclays life insurance cost?

Barclays life insurance starts from £6 per month but the price of your specific life insurance will be calculated based on the following details:

  • How much money the life insurance will pay out upon your death
  • How long the life insurance will cover you for
  • The type of life insurance that you choose
  • Your age at the time of starting your life insurance
  • Whether you smoke
  • Your health
  • Your occupation
  • Your lifestyle and pursuits

£250,000 of simple life insurance over 25 years for a non-smoker

Age Barclays life insurance monthly premium Cheapest equivalent life insurance premium we could find
20 £7.92 £5.43
30 £13.59 £8.76
40 £27.88 £18.15
50 £64.05 £45.48

£250,000 of simple life insurance over 25 years for a smoker

Age Barclays life insurance monthly premium Cheapest equivalent life insurance premium we could find
20 £11.85 £7.98
30 £21.56 £16.12
40 £57.91 £40.14
50 £156.41 £110.31

£250,000 of Barclays mortgage life insurance over 25 years for a non-smoker

Age Barclays life insurance monthly premium Cheapest equivalent life insurance premium we could find
20 £6.71 £4.98
30 £8.51 £6.13
40 £18.14 £11.53
50 £42.63 £28.33

£250,000 of Barclays mortgage life insurance over 25 years for a smoker

Age Barclays life insurance monthly premium Cheapest equivalent life insurance premium
20 £9.24 £6.87
30 £13.86 £9.99
40 £32.19 £23.59
50 £96.96 £71.67

 

The above quotations for Barclays life insurance clearly indicate that it is not the most competitively priced life insurance available across the market and may cost a lot more over the period of your insurance than the cheapest equivalent personal insurance available through an independent life insurance broker*.

Barclays life insurance reviews

Barclays bank scores a total of 1.5 out of 5.0 on independent customer review site Trustpilot however the reviews are based on Barclays Bank overall and not specifically for Barclays life insurance. Barclays bank life insurance has a 3 star rating from independent financial services comparison specialist Defaqto.

Having looked closely at the life insurance policies and prices available through Barclays, it would be fair to deduce that the life insurance offering from Barclays is average in the market. The life insurance policies provide a basic standard of insurance while the critical illness cover is of a moderate standard compared with other products available to buy on the wider market.

Barclay's life insurance pros and cons

Pros

  • Reputable and recognised brand
  • Life insurance starts at £6 per month
  • Useful online cover calculator tool

Cons

  • Reviews of Barclays are poor
  • Customer service seems to be the largest reason for disappointment amongst customers
  • You cannot buy whole of life insurance, over 50s life insurance or income protection insurance

Alternative to Barclays bank life insurance

It is reasonable to conclude that Barclays bank provides basic life insurance and critical illness insurance. When buying life insurance and critical illnesss insurance, it is helpful to compare products and prices available across the market as these can differ hugely and you don't necessarily have to pay more to buy a better insurance - in fact sometimes you may even pay less. For these reasons, it would be useful to explore alternative routes to buy life insurance that provides better quality insurance at a more competitive cost.

There are many life insurance brokers who can compare policies and prices on your behalf but the best of these will also provide valuable guidance as to the amount and type of cover you need. Having researched many such brokers in the market, we have found an expert independent insurance specialist. The advisers will talk you through your personal needs and address any concerns before searching the whole market for the most appropriate and competitively priced personal insurance policies. The added advantage is that you'll have access to many other products that Barclays do not provide which may be better suited to your needs and what you wish to spend. For example, you may wish to buy income protection instead of critical illness insurance so that you can protect your income in the event of being unable to work through an accident or illness.

The specialist advisers will also provide you with guidance and support to put your life insurance in a trust that will allow you to nominate your beneficiaries and potentially avoid any inheritance tax that may apply to the payout if there is one - this is also done free of charge.

You can arrange a callback from a qualified adviser* and talk through your requirements. If you buy your life insurance this way, you'll receive up to £100 cashback.

Summary

It can seem more accessible to approach your bank for life insurance as you are already a customer but in reality, your life insurance is with an external insurance company and will be serviced by them. In the case of Barclays, this is Legal & General. While Legal & General is a reputable insurer and provides good life insurance and critical illness products, you will find that you can often buy its products cheaper through a broker than you can through a bank.

 

 

If a link has an * beside it this means that it is an affiliated link. If you go via the link, Money to the Masses may receive a small fee which helps keep Money to the Masses free to use. This link can be used if you do not wish to help Money to the Masses and do not wish to qualify for the cashback referred to in the article