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What is a joint life insurance policy?

We reveal what you need to know about joint life insurance, including the pros and cons, costs and discover whether it’s the right choice for you.

Summary

  • A joint life insurance policy is not just for married couples but for other partnerships too.

  • This type of policy can offer savings from 25%-40% compared to two single policies.

  • The best life insurance for married couples includes tailoring coverage to align with shared and individual financial goals.

  • Connect with a trusted insurance broker via Unbiased, who can help you find the best policy. 

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What is joint life insurance?

Joint life insurance covers two individuals simultaneously, providing a lump sum payout if either person passes away during the policy term

According to Reassured, over 40% of policies fall under this category, making it a popular choice for married couples, civil partners, cohabiting couples, long-term partners, and even business partners.

One of the biggest advantages of joint life insurance is its cost-effectiveness.

By consolidating coverage into a single plan, individuals can save up to 40% on premiums compared to two separate policies. 

Applying for joint life insurance involves a single application form and requires health and lifestyle information from both parties.

Insurers use this combined data to assess the collective risk and determine the monthly premium. 

Once in effect, both individuals are protected under the same policy with a single monthly premium ranging from £20 to £50.

Costs are influenced by the policyholders' age, health conditions, coverage amount, policy duration, and smoking habits.

What are the pros and cons of joint life insurance?

As with any financial decision, there are pros and cons to consider when comparing joint life insurance and single cover.

Pros

  • Cost savings: Insurers frequently offer discounts for joint coverage, resulting in substantial savings compared to two single policies.

  • Convenience: With joint life insurance, there is only one monthly premium to manage, one contract, and a single policy for both individuals. 

  • Versatility: Joint life insurance is suitable for various types of couples, making it a practical option for a range of relationships.

  • Simple application process: The application process involves filling out a single form, streamlining the underwriting process and simplifying the overall application.

Cons

  • Limited customisation: A joint life insurance policy may offer less flexibility in customisation. 

  • No survivor benefits: Once a claim is paid, the joint life insurance policy typically terminates, leaving the surviving individual without coverage. 

  • Premiums are tied to collective risk: The monthly premium is calculated based on the combined risk of both individuals. 

  • Impact of relationship changes: Joint policies may become complicated in the event of relationship changes such as divorce or separation. 

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Is joint life insurance for married couples only?

Joint life insurance for married couples is not the only type of joint cover available. 

Unmarried partners, business partners, and even family members can opt for joint coverage.

That said, marital status can impact costs, with married couples potentially enjoying lower premiums due to shared financial responsibilities and stability.

Business partners seeking financial protection for their shared ventures or family members looking to provide for each other can also explore joint life insurance options.

Joint life insurance vs single life insurance

While joint coverage offers shared benefits, single life insurance provides individualised protection, allowing the policyholder to tailor coverage to their needs, financial obligations, and dependents. 

On the other hand, a joint life insurance policy covers two individuals under a single policy. The death benefit is paid out upon the first policyholder's death, and the policy typically terminates. 

Choosing between joint life insurance and single life insurance depends on individual circumstances and preferences.

Single life insurance is suitable for those requiring personalised coverage, while joint life insurance is a practical choice for couples or partners seeking shared financial protection.

What is the best life insurance for married couples?

The best life insurance for married couples depends on individual needs, so tailoring coverage to suit your shared and individual financial goals is key.

Determining this involves considering various factors, including mortgages, other credit arrangements, financial goals, medical conditions, dependents, and budgetary constraints. 

Ultimately, the best life insurance for married couples is a personal choice that aligns with your unique financial situation and future aspirations. 

What happens with life insurance after divorce?

The fate of joint life insurance after divorce hinges on the unique circumstances of the separation.

Options include maintaining coverage, transferring ownership, converting to individual policies, surrendering the policy, or updating beneficiaries. 

Am I too old for life insurance?

There is usually no age barrier to obtaining single or joint life insurance, but it is essential to understand that costs can vary significantly with age.

Premiums tend to rise as people age, emphasising the importance of securing life insurance early to lock in more favourable rates. 

Seek expert financial advice

Joint life insurance stands out for its widespread appeal, combining cost savings with streamlined processes.

However, the pros of shared coverage, such as convenience and versatility, come with considerations, from divorce to ageing, that emphasise the need for careful assessment. 

Let Unbiased match you with an experienced insurance broker for tailored guidance on navigating the complexities of life insurance, especially joint policies.

This will ensure you plan for the future and offer security to those you leave behind.

Get insurance advice
We’ll find a professional perfectly matched to your needs. Getting started is easy, fast and free.

 

About the author
Our team of writers, who have decades of experience writing about personal finance, including investing, retirement and pensions, are here to help you find out what you must know about life’s biggest financial decisions.