Joint Life Insurance – Meaning, Types and Coverage

Joint life insurance is a type of policy that offers coverage for two people, typically spouses or domestic partners. Instead of having two separate policies as a couple, you can purchase a joint life insurance quote that will cover both you and your spouse.

Joint Life Insurance - Meaning, Types and Coverage

Furthermore, this policy provides financial stability if one of the policyholders dies. The premium is, however, paid by both parties for a fixed period, and the payout is on a death basis. Therefore, if one of the policyholders dies or passes away, the money or sum will be given to the other party or policyholder.

Types Of Joint Life Insurance

There are two types of joint life insurance, and companies provide these two types of quotes. However, remember that the payout circumstances vary, but you still only pay a single death benefit. Now, here is a more-explained version of both policies:

First-to-Die

With this type of insurance, when one of the insured parties dies, the other surviving partner will get the death benefit. Therefore, they will be getting financial support even when their partner is no longer around.

So, when the death benefit has been received and there are no additional benefits paid, the other policyholder or party will not have life insurance again. However, some insurance companies recommend a covert policy option but this policy is more expensive.

Second-to-Die

This type of insurance is also known as survivorship life insurance. This policy is implemented after the second surviving policyholder dies. In other words, no policyholder will get the death benefit. Instead, the benefit will be given to the joint policyholders’ beneficiaries.

With second-to-die, when the first party dies, the remaining party will be responsible for making premium payments to maintain the coverage. However, this type of policy is not ideal for new or young couples who need a payout for the surviving partner.

What Does it Cover?

Understanding how the concept and method of this insurance work is very simple. This policy simply covers both the husband and the wife under a single policy. Additionally, it also offers financial stability if one of the policyholders dies.

The first-to-die policy covers the surviving policyholder after the first person passes away. As for the second-to-die policy, its coverage is implemented after both policyholders have died. So, their benefits are given to charity or an heir.

What Does It Not Cover?

To repeat, if you have a joint life insurance policy, you can only get coverage and benefits after one of the policyholders has died. What’s more, unlike individual policies, two people will enjoy coverage with a joint life insurance policy or quote. So, as a couple, if you purchase a joint life insurance policy, if one of the partners dies, the other party will get the death benefit. To sum up, you will only get coverage from your joint life insurance policy if one of the policyholders passes away.

Requirements For a Joint Life Insurance Policy

Similar to other insurance policies, you need to provide some information and documents to be able to apply for and get a policy. So, to be able to apply, here is what you need:

  • Date of birth of both parties.
  • Names of the couple.
  • Medical history as well as conditions and treatment.
  • Lifestyle factors.
  • Job.
  • Smoker status.

So, if you are planning to get a quote, it will be a good idea to gather all these documents and prepare the necessary information before you proceed.

How Much Does It Cost?

The cost of joint life insurance depends on and is determined by different factors. Nevertheless, the most important factors include your state of health and age. Factors like whether you are a smoker or not, if you drink alcohol or not, weight and height, and other lifestyle factors are necessary for calculating your premium. The insurance company you choose to work with also plays an important role in the cost of your insurance policy.

Why Get Joint-Life Insurance?

There are a lot of benefits that you enjoy when you purchase a joint life insurance policy. Firstly, joint life insurance is more affordable than having two different or separate policies.

However, if you are trying to figure out whether or not joint life insurance is a good option, you must consider your budget, your relationship, and the level of coverage you want. These will help you decide on a better plan.

Besides, when you buy a first-to-die policy, the payout or benefit goes straight to the surviving partner. This is to show how smooth and fast the payment process is. On the other hand, the policy can get a lot more complicated if the couple divorces or splits up.

How To Apply

If you are looking to shop for joint life insurance but do not know what to do, relax, because I have got your back. Here are some helpful tips you can use when you are searching for the best insurance:

  • Find out how much coverage you need as a couple.
  • Compare the quotes of companies or lenders.
  • Proceed with the application.
  • Submit your application and wait for approval from the company.
  • Sign and agree to your policy.
  • Make payment for your first premium.

After you have gotten the policy offer and the company has approved your application, you can start making your coverage active and running.

The Best Joint Life Insurance Companies

Here are some of the best insurance-provider companies that you can use if you are considering this:

  • State Farm.
  • Zurich.
  • Guardian Life.
  • Royal London.
  • New York Life.
  • Vitality.
  • Aviva.
  • Fidelity Life.
  • Legal and general.
  • Protective.
  • Corbridge Financial.
  • Pacific Life.
  • Ladder.
  • Lincoln Financial.

And many others. So, with the steps provided above, you can choose or find the best company for your needs. These companies also offer affordable rates to couples.

What Happens To Joint Life Insurance After Divorce?

If you and your spouse have a joint life insurance policy and you end up divorcing, your ex-partner can keep a life insurance quote that covers you and gives a death benefit to them if you pass away even after the divorce. This happens this way because when you have a life insurance policy, you can only change or cancel it as a policyholder.