Joint life insurance covers two people on one policy. It pays one death benefit, either when the first person dies or after both have died.
Married couples, domestic partners, and business partners can buy joint life insurance.
First to die pays when either person dies. Then the policy ends. The survivor must buy a new policy if they still want coverage, and it may cost more at an older age.
Second to die, also called survivorship, pays after both people die. Most are permanent policies. They are mainly used for estate planning.
Two separate term policies usually cost less than one joint policy. But second to die can cost less than a permanent policy on one person.
Joint policies can make divorce harder. A second to die policy also means a long wait before anyone gets paid.
- First to die: pays at the first death
- Second to die: pays after both deaths
- Spousal rider: adds term coverage for a spouse to your policy
More questions
Is joint life good for a couple with kids?
Often separate policies fit better, since each person gets their own coverage and can pick their own amounts.
Why would someone pick second to die?
It can help with estate plans or a business plan. It is also an option when one person cannot qualify alone.
Words to know
- Estate
- All the money and property a person owns, especially at death.
