Everything you need to know about Joint Life Insurance
Ensure security for you and your partner with a single policy!
- By Paddy Compare
- 11 June 2023
Investing in life insurance is a great way to ensure your loved ones are financially protected in case the worst happens to you. If you have a financially dependant partner or simply want to ensure financial security for them, life insurance is a good option for you.
There are many types of policies to choose from and most insurance policies also offer optional add-ons to help you personalise your policy plan and make it more suitable to your needs.
Other types of life insurance:
- Death in Service cover
- Joint Life Insurance
- Terminal Illness Cover
- Over 50s Life Insurance
- Critical Illness Cover
Paddy Compare provides you with expert advice, tailored to your needs and puts you in touch with brokers who will give you the best price quotes in Ireland.
What is joint life insurance?
Joint life insurance is a type of life insurance policy that covers two or more individuals under a single policy. It is typically purchased by couples or business partners who want to ensure financial protection for their dependents or business in the event of their death.
How does it work?
With joint life insurance couples or business partners can use a single policy to ensure financial security for two individuals.
- The policy will pay a death benefit only once, usually upon the first death. After the death benefit is paid, the policy terminates, and the surviving individual is no longer covered.
- Joint life insurance policies can be either term life insurance or permanent life insurance. Term life insurance provides coverage for a specific period, such as 10, 20, or 30 years, while permanent life insurance offers lifelong coverage.
- The premiums for joint life insurance are typically lower than the premiums for two separate individual policies.
Who should choose joint life insurance?
Joint insurance can be used by couples to protect a surviving partner from significant financial burdens. It is often used by couples who have:
- Shared mortgages, loans, or debts
- Dependants relying on their joint income
- A disparity in income with one higher-earning partner
It can also be used as part of financial planning strategies by:
- Business Partners to buy out a deceased partner's share of the business
- Heirs to an estate to pay estate taxes, settle estate debts, or ensure an equitable distribution of assets
- Couples with mortgages
Advantages and disadvantages of joint life insurance
| Advantages | Disadvantages |
|---|---|
| Joint life insurance is less expensive than taking out two individual policies. | The claim is paid out upon the first death only. The policy ends after the first person dies. |
| One regular payment and a single policy can be easier to manage for two people. | The premiums may be higher compared to one individual policy for the same amount of coverage since the risk is assessed based on their joint life expectancy. |
| A couple without children may choose joint life insurance to financially protect their partner in case one person dies. | Joint life insurance is tied to the relationship between insured individuals. If the relationship dissolves, such as through divorce or separation, the policy may no longer be suitable. |
|
Joint life insurance can be used to cover legal obligations. Business partners often use it to secure their partners' shares in the event of a partner's death. It can also be used in estate planning strategies to cover financial debts during inheritance. |
Joint life insurance only works if both partners' coverage needs are the same. If one partner has significantly higher insurance needs than the other, joint life insurance may not be suitable for that couple. |
In addition to this, gain insight into what factors affect your life insurance policy and how they define what a life insurance policy covers in general.
Also, don't miss out on essential tips for getting cheap life insurance in Ireland.
Planning on buying life insurance?
Life insurance can be confusing. How much life cover do you need? Which plans offer the best premiums for your requirement? What's the best plan for you based on your specific situation?
Use Paddy Compare's services to get a clearer idea of what to opt for. We will do the hard work for you and put you in contact with life insurance brokers that are ready to help and provide you with great quotes.
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