When it comes to choose between single or joint life insurance there are a few things to consider before jumping into either.
In today’s blog, The Cheapest Life Insurance takes a look at what you might want to consider before signing on the dotted line, so that you get the best cover for your money.
Many couples ask whether single or joint life insurance is going to be the best option. A single life insurance policy will cover one person and will pay out the sum insured if that person passes away during the term of the policy.
A joint life insurance plan will cover both lives, usually on a ‘first death’ basis. This basically means that the sum insured will be paid out if the first person passes away during the term of the policy. One fundamental difference here is that once there is a pay-out often that’s the end of the play itself, meaning the person claiming will no longer be covered themselves.
Two single life policies therefore will pay out twice, whereas the joint policy is only going to pay out once.
Of course both single and joint cover has its benefits and negatives, so it does very much depend on your personal circumstances as to how you deal with them and what kind of policy will suit you.
So what you need to consider is your budget – as one joint policy is likely going to be cheaper than two single policies. You may feel it is more beneficial to buy two separate policies if the price difference is to your liking or you may be affected by cost, in which case you may be happy with the joint cover option.
The cover itself may be something to look at to. You may need less cover than your partner or indeed they may require less than you. So in determining the cover you should think about the roles that you both play. Is one of you the higher breadwinner for example? Does one of you provide all of the child care?
If you have a joint policy and in the future your relationship sadly ends, then your policy cannot be divided upon the breakup. This is why two single policies might be beneficial.
Equally, as we have highlighted, should one of you make a claim, then the surviving partner would not have any life cover themselves.
Always consider the options very carefully when it comes to life insurance cover and make sure you know all the details and exclusions when choosing single or joint life cover.