Your Vitality Premium Went Up Again – Here's Why
One of the most common questions we hear at TMS is: "Why is my Vitality life insurance going up every year?" Many people took out Vitality Life or Serious Illness cover on the Optimiser plan because the starting premium looked very competitive. A few years later, the monthly cost has risen noticeably, sometimes even though the amount of cover is going down.
This is not a mistake on your bill. It is how the Optimiser option is designed. Below we explain how it works and the two clear options available if you want to take control of the cost.
How Vitality Optimiser Works
Vitality Optimiser gives you an upfront discount on your premium at the start of the policy. In return, your premium is reviewed each year and can increase according to your Vitality status, which is earned through activity points, health checks and engagement with the Vitality programme.
- Upfront discount: a lower starting premium than a standard policy.
- Annual indexation/escalation: premiums typically rise each year by a set percentage unless you maintain Platinum status every year.
- Lower statuses (Bronze, Silver, Gold) can mean larger annual increases.
- Compounding effect: small yearly rises build up, so after five to ten years your premium can be far higher than a level-premium policy would have been.
Life gets busy. A new baby, an injury, a change of job or simply less time for the gym can mean you drop below Platinum for a year, and the premium increase follows.
Why premiums rise on decreasing cover
Many clients have Decreasing Mortgage Life and Serious Illness cover, where the sum assured falls in line with a repayment mortgage. It feels illogical that the cost goes up while the cover goes down, but the Optimiser adjustment applies to the premium regardless of the falling sum assured. You can end up paying more each year for less protection.
Your Two Clear Options When Reviewing
Option 1: Switch to a fixed-premium policy with Vitality
If you value the Vitality rewards, such as discounted gym membership, coffee, cinema or smartwatch offers, you may be able to move to a fixed-premium version with Vitality. Your premium will usually be based on your current age and health, so it may be higher than your original starting premium, but it stops the annual escalation. This option suits people who genuinely use the benefits.
Option 2: Move to a level, guaranteed fixed-premium policy with a whole-of-market insurer
If the rewards are not important to you, a guaranteed level premium from another insurer, such as Legal & General, Aviva, Zurich, Royal London, LV= or Guardian, means your cost is fixed for the full term. No points, no status, no annual surprises. As an independent adviser we compare the market, check how each insurer defines serious and critical illnesses, and look at features like children's cover and fracture benefit.
- Guaranteed premiums that never change.
- Cover can be aligned to your current mortgage balance and term.
- Opportunity to add or restructure cover such as income protection or family income benefit.
The Golden Rule: Never Cancel First
Never cancel your existing policy until your new cover has been fully underwritten, accepted and is on risk. Your health may have changed since you first applied, and a new insurer might exclude a condition, apply a loading or decline. Cancelling early could leave you or your family with no cover at all. At TMS we arrange the new policy first, confirm the start date, and only then help you cancel the old one.
Life Events That Should Trigger a Review
- Remortgaging, moving home or increasing your mortgage.
- Getting married, separating or having children.
- A pay rise, a new job or becoming self-employed.
- Losing employee benefits such as death-in-service.
- Your premium rising for two or more years in a row.
Relevant Life Cover for company directors
If you are a Limited Company director paying for personal life cover from your own net income, Relevant Life Cover may be far more tax-efficient. The company pays the premium, it is usually an allowable business expense, and the benefit is paid to your family outside your estate. Learn more on our business protection page.
Protection Options at TMS
We review and arrange life cover, critical illness cover, income protection and family income benefit, making sure your protection matches your mortgage and your family's needs today rather than when you first bought it.
Real-World Example
A couple in Bexhill took out Decreasing Mortgage Life and Serious Illness cover on Optimiser six years ago at around £48 a month. After several years at Silver and Gold status, the premium had climbed to over £70, while the cover had reduced with their mortgage. When they remortgaged, we compared a fixed-premium Vitality option against guaranteed level premiums across the market, matched the new cover to their new mortgage balance and term, and arranged a level-premium policy that was underwritten and on risk before the old plan was cancelled. Their premium is now fixed for the full term.
What to Check Before Switching
- Your current health, including any new diagnoses, medication or recent tests.
- Whether your existing policy has valuable features you would lose.
- The definitions of serious and critical illness on each policy.
- Whether the policy is written in trust so any payout avoids delays and inheritance tax.
- How the new term and sum assured match your mortgage and family needs.
We handle the comparison, the application and the trust paperwork for you, and keep you informed at every step.
Speak to TMS
Seen your Vitality premium go up again? Contact TMS today for a free, no-obligation chat with an adviser.
Frequently Asked Questions
Why does my Vitality premium increase every year?
On the Optimiser plan you receive an upfront discount, and premiums are then adjusted annually, typically increasing unless you maintain Platinum status.
Why is my premium rising if my cover is decreasing?
The Optimiser adjustment applies to the premium regardless of the falling sum assured on decreasing mortgage cover.
Can I switch to a fixed premium with Vitality?
Often yes, though the new premium is usually based on your current age and health.
Is it safe to cancel my Vitality policy?
Only once replacement cover is fully underwritten, accepted and on risk. Never cancel first.
Which insurers offer guaranteed level premiums?
Insurers including Legal & General, Aviva, Zurich, Royal London, LV= and Guardian offer guaranteed fixed premiums.
