Borrowing Against Life Insurance: What Over 40s Should Know

Author: Steve Case - Insurance Expert

Reviewed & Fact Checked By: Elaine Brookes

Updated: 21st February 2025

borrowing against life insurance policies when in your forties

People living in the UK with permanent life insurance policies may be able to borrow against their policy’s cash value.

One of the main benefits of borrowing from your life insurance policy is that you can do this for any reason, at any time.

Your age doesn’t matter, but what does matter is that you have sufficient cash value to borrow against.

Even if you have the best life insurance for people over forty, borrowing against your policy isn’t risk-free.

Any unpaid life insurance loans can cost you your policy or reduce the death benefit your beneficiaries receive, so always consult your insurance broker before taking out a loan.

Interested In A Flexible Over 40s Policy? Get A Free Quote Today

UK companies offering permanent life insurance cover

Amount of cover?*Choose an amount that reflects your financial needs in the event of a claim. For instance you might want to pay off a mortgage or debts, or leave a lump sum to your family
First Name:*
Last Name:*
Date of Birth*Your age is one of the factors used to calculate your premium. You must be aged between 18 and 80.
Day
Month
Year
Email*
Phone Number*
Our price match promise means we will find you the right cover for your personal circumstances at the lowest price possible. Terms & Conditions and Privacy Policy

Types Of Policies You May Be Able To Borrow Against

Whole Of Life Insurance: Provides coverage for the insured’s entire lifetime, with a guaranteed payout upon death.
Over 50s Life Insurance: Designed for people aged 50+, with guaranteed acceptance and a fixed payout.
Investment-Linked Whole Of Life Insurance: Includes an investment element, with premiums invested in funds that affect the payout.
Balanced Cover Whole of Life Insurance: Combines a guaranteed payout with an investment-linked element.
Maximum Cover Whole of Life Insurance: Starts with lower premiums but may increase depending on investment performance.

Reasons to Borrow From Your Policy

There are many reasons to borrow from your policy. For example, if you want to avoid loan restrictions, you can borrow against your policy for anything you want. This can help with mortgage payments, credit card debt, or emergencies.

Other reasons to borrow from your policy include:

Avoid a repayment schedule

Borrowing from your policy means you can pay back the loan whenever you want. Just ensure you don’t let your owed amount exceed your cash value, and you must continue to pay your premiums on time and in full.

Avoid asset risks

When you borrow from your life insurance policy, none of your other assets are at risk, and your cash value account can continue to grow even after you borrow money from it.

Get extra money quickly

Credit checks, employment verification, and minimum income requirements are unnecessary to borrow against your policy.

How to Take a Loan From Your Life Insurance

Exact details can vary depending on your policy terms and conditions, but typically, you would start by checking your cash value.

The amount you borrow depends on how much monetary value your policy has already built up, and the minimum amount varies by insurer.

It can sometimes take years to accumulate enough of a minimum amount to borrow against.

Click To Compare Life Insurance Quotes

Next, you would request the loan from your insurance company or agent. They will then ask you to fill out a form, but this is not an application or a credit check.

Finally, if the cash value is high enough to borrow from, you will receive the funds within a few days.

Which Life Insurance Policies Can I Borrow From?

If you’re approaching your middle age, life insurance is important. While you may need to know how to calculate your life insurance needs after age forty, you also need to understand the different types of policies. Term policies can have more affordable premiums but do not include cash-value accounts.

If you want a life insurance policy that allows you to borrow against it, choose a permanent one such as whole life, universal life, and final expense insurance.

Find the Right Policy at Insurance Hero

While life insurance can sometimes seem complicated, you can find policies that help you in your lifetime while providing the most for your beneficiaries.

At Insurance Hero, we make finding the right policy more straightforward than ever. We also include insights on updating your life insurance beneficiaries after forty, understanding what happens if you miss premium payments and more.

Ready to get started on your life insurance journey? Contact us today to begin your quick, two-step process that will connect you with a personalised quote designed to protect your loved ones (without breaking the bank).

Research Sources Used:

Steve Case

Steve Case is a seasoned professional in the UK financial services and insurance industry, with over twenty years of experience. At Insurance Hero, Steve is known for his ability to simplify complex insurance topics, making them accessible to a broad audience. His focus on clear, practical advice and customer service excellence has established him as a respected leader in the field.