Joint life insurance has become a very common form of insurance coverage in recent years. Many young couples only purchase individual life insurance to support the breadwinner, usually their spouse, until they die. A joint life insurance policy allows them to delay the distribution of assets until both individuals have passed on. This is a great benefit because it means that the couple can still live comfortably for many years after their deaths.
In some cases, one partner will work while the other stays at home. This situation is referred to as ‘heterosexuality’. Under most policies, the one who stays at home is granted complete life insurance coverage. If the other partner is the breadwinner of the family, it may be more difficult to get coverage, especially if one partner is not willing to leave the home to seek employment. Even if it is possible to obtain coverage for the remaining family members through other sources such as joint employment or pension plans, the cost can be prohibitively high.
Joint coverage is most useful if there is no other way of paying off existing debt and expenses immediately after the death of the primary insured. The remaining family members are then left to deal with expenses and debt until they have sufficiently accumulated enough money to cover their expenses without relying on a single income source. A first-to-death policyholder passes away, leaving a dependent child and spouse without financial means to provide for themselves. They are left with debts they must pay, taxes that must be paid, funeral costs, and other costs that can have a significant financial impact on the surviving persons. A first-to-death policy provides coverage for those persons who can’t live on their own and need a large sum of money immediately.
As death benefits are paid by the estate of the deceased, it is important to determine whether these payments will be sufficient for the benefit and use of the surviving spouse, children or dependents. Many life insurance policies cover a surviving spouse and their children; however, it is often necessary to purchase additional coverage for others. Typically, joint life insurance policies cover each spouse or children as follows: the children immediately left in the lives of the policyholder and those children who are educated, whether they are homeowners or not, and who is married or not.
Typically, this type of life policy is purchased to provide coverage for two people who have died. One person may already have a policy that will cover them, while the other person may not have one yet. Often, when a person dies and there are no dependents, both policies will be paid for. This is why it is sometimes preferable to purchase two single policies to cover the two people who will need insurance together. In addition, in some cases, a couple may want two separate policies so that one spouse can collect on the policy while they have a family; therefore, obtaining two separate policies makes sense.
What is the benefit of purchasing a surviving spouse and child life insurance? Often, when a person passes away, their spouse and children do not receive any money. However, the surviving spouse may be eligible for a loan from their bank account, which could potentially provide them with enough funds to pay off bills and funeral costs. The loan will be applied to the outstanding mortgage or loan balance owed on the deceased person’s property, making it possible for family members to obtain needed cash in order to take care of daily living expenses. In addition to providing money to pay for the daily expense of living, a surviving spouse or child will also receive inheritances from the deceased person’s estate. This will take place if the person who has passed away is married.
When applying for a joint life insurance coverage, the surviving spouse must be a person that is legally married. The joint life insurance coverage will begin to pay the deceased’s debts immediately, meaning that there will be no waiting period for debts to be paid off. Furthermore, the beneficiary will receive all the death benefits from the insurance policy immediately, including the burial expenses, and will receive no other inheritance benefits. As a result, the surviving spouse will not have to make monthly payments on the joint first-to-dies policy. Furthermore, if the insured dies while the beneficiary is still alive, he/she will be able to claim his/her inheritance right along with the other individuals who are beneficiaries of the policy.
Although the above mentioned advantages are certainly wonderful benefits, some people need more than others. Individuals who do not currently own any life insurance policies, or who are less than 18 years old will not be eligible for joint life insurance policy coverage. As well, individuals who have more than one dependent will usually have to pay a higher premium for a joint life insurance policy. In general, however, joint life insurance policies provide a solid benefit for virtually any couple or family looking to protect their financial interests in the event of a death.