When it comes to insurance, it can be hard to know what’s right for you. You might be inclined to just log onto a comparison site and go for the first insurer to offer the cheapest quote. However, when you’re a couple, you must find an insurance policy that fits your individual needs jointly to cover everything necessary.
So, what type of policy is best for young couples? What kind of joint life insurance best suits a couple’s needs? Or is a single policy a better option? It can be hard to know what’s right for you. So, let’s summarise some of the best options:
What is joint life insurance?
Many of the policies on this list are joint life insurance policies. A joint life insurance policy provides coverage to two people. Married couples typically buy joint life insurance policies. These policies are a good option when one spouse does not qualify for estate planning or insurance policy.
Joint life insurance policies are typically permanent, meaning they last your lifetime. That said, you can also get term joint life insurance policies. These joint life insurance policies only last for a set time period of your choice.
“First-to-die” life insurance
As the name suggests, a first-to-die life insurance policy pays out after the first partner dies to help financially support the surviving partner. However, this life insurance policy is no longer in effect after insurers pay out the death benefit. So, if the surviving partner wants further coverage, they will then have to apply for a new insurance policy.
First-to-die life insurance policies work well for someone with considerable debts, such as a mortgage. First-to-die is also a good option if expenses are primarily paid by one spouse and for families with younger members.
“Second-to-die” life insurance
This life insurance policy pays the death benefit out after both policyholders die. It doesn’t matter how long the period is between these two deaths. But, the surviving partner must still pay for premiums even after their spouse dies.
Second-to-die insurance is a good option for couples who need to pay inheritance taxes, cover their estate taxes and leave wealth for their children.
Term life insurance
Another ideal option for some couples is term life insurance. Flexible and inexpensive, you generally purchase term life insurance as a single policy. However, getting a joint-term life insurance policy is also possible.
Choose a term length like 10, 15, 20, or 30 years, and you’ll have your chosen coverage for that term. Plus, if your needs change, you can change your cover with “riders”.
Permanent life policy
A more pricey option, but still the best option for some people, a permanent life insurance policy offers more options when you’re older. With a similar amount of coverage to most term life policies, you can draw against your permanent policy’s cash value to pay off your mortgage, fund a big wedding, go on vacation, or send your child to college.
Accidental death benefit
The accidental death benefit is one of the riders you can add to your term life or permanent life insurance policy. An accidental death benefit rider pays out an extra sum of cash if a mishap causes your death. These policies restrict the timing of the accident and the dying – for example, your death may have to occur within 90 days of the accident. On top of this, accidental death policies also vary in what constitutes an accident. An accidental death benefit is also available as a standalone policy.
Sure, not every young couple has children. But if you do, and they’re who you want to cover, it makes sense to consider children’s insurance. Typically available as an optional cover alongside life insurance policies, children’s insurance covers your child for diagnosis of a terminal illness, death, or a specific illness or defined serious injury. Your child might have to be between 2 and 17 years old to get coverage.
Total and permanent disability insurance
Another policy available as optional cover with a life insurance policy, total and permanent disability insurance, covers you if you become totally and permanently disabled. You get a lump sum payment of up to $1 million which can go towards ongoing care or medical bills, but you are only eligible between 18 and 60 years and if you work at least 20 hours a week. On top of this, the cover might expire after you turn 65.
What’s right for us?
So, what life insurance policy is right for you? Compare policies today to find the insurance policy that’s the best fit for you!