Family Income Benefit is a life insurance product, not a state benefit
Family Income Benefit (FIB) is a type of decreasing term life insurance sold by insurers. If you die during the policy term, it pays your family a regular monthly income until the end of the term, rather than a single lump sum.
It has nothing to do with HMRC, DWP or the UK benefits system. DWP does not offer Family Income Benefit. It is not connected to Child Benefit, Universal Credit, Tax Credits or any government payment.
If you arrived here looking for state benefits you can claim for your family, the relevant pages are below.
How Family Income Benefit works
You take out a policy that runs for a set term, typically until your youngest child reaches adulthood or your mortgage ends. You choose a monthly income amount, for example £2,000 a month.
If you die during the term, your family receives that monthly income for the rest of the policy term. If you take out a 20-year policy and die in year 5, your family receives the income for the remaining 15 years.
The monthly payout reduces the total cost of insuring you because the insurer's maximum potential payout falls as the term shortens. This makes FIB cheaper than level-term life insurance that pays the same fixed sum throughout.
Who Family Income Benefit is designed for
FIB is typically used by parents who want to replace their income rather than leave a lump sum. It suits families where ongoing monthly costs (mortgage, rent, childcare, school fees) are the main concern rather than a large debt to clear.
Single parents and primary earners in a household with children are the main users. The policy is designed so the payout mirrors what your income would have paid each month.
It is not means-tested. Whether you claim state benefits or not has no bearing on whether you can buy Family Income Benefit.
State benefits for families: what you may actually be looking for
If you are looking for government support for your family, the main routes are Universal Credit (means-tested support for low-income households), Child Benefit (£27.05/week for first child, not means-tested), and the childcare entitlements available through Universal Credit or Tax-Free Childcare.
Bereavement Support Payment is a DWP payment for surviving spouses or civil partners after a partner's death. It pays a lump sum of £3,500 plus up to 18 monthly payments of £350. This is the state equivalent that is sometimes confused with Family Income Benefit.
Guardian's Allowance is also a state payment, worth £21.75/week in 2026/27, for people bringing up a child whose parents have died.