My late father had a Life Insurance Policy and for the level of contributions he made across the term of the policy it was a positive outcome with the returns being well in excess of the payments with the impact of inflation taken into account. However, there are many that do not benefit in the same way as they often fail to keep up payments and the policy fails to pay out at the time of death. In the UK the proceeds are part of the inheritance tax allowance and should the proceeds of the life insurance take the estate over the tax threshold then tax is payable.