Joint life insurance: an attractive solution for couples and business partners

Sometimes, two heads are better than one. That’s the principle behind an approach known as joint life insurance, where two people are involved.

As the name implies, this life insurance solution is designed to jointly cover two people with one policy. There are two ways that it can be set up: first-to-die or last-to-die.

The first-to-die option pays out the sum insured to the survivor after the death of the other insured. This type of coverage is useful for couples or business partners who want to ensure the surviving person’s immediate financial security. For example, a surviving business partner could use the death benefit to keep the company going or to recruit new key employees.

The last-to-die option pays out the benefit only after both insureds have died. This product is often preferred for estate planning, particularly to offset any taxes that would have to be paid before the estate could be transferred to the heirs. 

The main advantage of joint life insurance is its cost, which is generally lower than two individual policies. As well, it’s simpler to administer since only one policy has to be underwritten.

This makes it an attractive solution for anyone wishing to protect their family, their business or their legacy.