Family Income Benefit
Family Income Benefit is a monthly tax free benefit payment, paid monthly in the event of death or diagnosis of a critical illness. Unlike traditional life or critical illness cover which pays out a lump sum, this policy pays a monthly income for a set period of time. The money can be used for any purpose, but usually to pay bills and maintain your families standard of living
How does it work?
When the policy is set up, you decide the monthly amount of benefit you would like to receive. There are some rules around this but currently the benefit is paid tax free. You can also decide how long you would like the benefit payment to continue, but typically it is arranged till your eldest child is aged 18.
How much does it cost?
Once the policy is live you will pay a monthly premium for the cover. For example for just £21.31 per month, you could have a 10 year policy which would pay £1,500 per month tax free in the event of a valid claim*
The policy can be set up for any period of time, as long as you maintain the monthly premiums, the policy will remain live and ready to respond to a valid claim.
Family Income Benefit Providers
Family Income Benefit is provided by insurance companies, many of them are household names like Aviva, Zurich, Vitality and Legal & General. There are other more specialist providers who will offer more bespoke policies.
Family Income Benefit can be obtained by most people including those who may have existing medical conditions or have a history of illness, but the monthly payments may be higher.
What affects the cost of the policy?
The monthly payments for your policy can be fixed for the full length of the term (i.e. 20 years) so you pay the same amount per month for the full term.
Factors that affect the cost relate to your health and jobs that could be considered more dangerous, for example oil rig workers, may pay higher monthly payments as well.
Using an Insurance Broker to arrange your cover
First Select Life Insurance arranges Life, Critical illness and Income Protection insurance from a range of leading providers and specialists. Not all policies are the same and selecting your cover based just on price, means your not comparing all features and benefits.
For just a few extra pounds per month, a policy could provide much more benefit, but this is not always clear on price comparison sites and consumers very rarely read policy documents. First Select Insurance Brokers check and compare policies and clearly call out the differences to our clients.
Ready to find out more?
Please complete the contact form below and one of our experts will be in touch, usually same day.
About us
First Select Life Insurance are friendly and professional mortgage and insurance brokers. We can access mortgages and insurance from the whole of the UK market, meaning we can get the best possible deal for our clients circumstances. Based in Manchester, we are a family business with decades of experience in financial services. Our goal is to be the most trusted regional mortgage and insurance advisory business in the northwest of England.
Our team of experts are ready and waiting to help. Contact the team below:
Phone: 0161 393 1575 // 07780 446 937
Email: hello@firstselectfs.co.uk
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References:
Quotations, 24/06/2026 based on non-smoking male aged 30. 10 year policy.
*Family Benefit Cover: £1,500 per month. Monthly Premiums £21.31 Aviva.
Source: https://www.aviva.co.uk/insurance/life-products/life-insurance/knowledge-centre/paying-out-when-you-need-it/