Initially, life insurance policies could only be owned by an Individual with his/her spouse as the beneficiary. However, insurance companies have modified life insurance policies according to the constantly evolving needs of its customers.
Joint Life Insurance policies were introduced in order to cover both the partners under a single policy. Since a couple is covered under a single policy, the surviving partner receives the sum assured when one of them dies.
Before you explore the key features and benefits of Joint Life Insurance, it is important to know the different types of joint life insurance. Joint life insurance can be broadly into two types:
What is Joint Term Insurance Plan
A Joint Term Plans are similar to individual term plans, where the premium is jointly paid by the couple. When one partner dies, the surviving partner receives the death benefit from the policy. However, just like an individual term insurance plan, a joint term plan needs to be renewed after a certain period of time.
Joint Endowment Plan
Under a Joint Endowment Plan, the couple receives the benefit amount once the policy attains maturity or on the death of a partner, whichever is earlier.
Why should you opt for joint term plans?
If you are a married individual, a joint life insurance policy will be more appropriate for you.
First and foremost, you will be saved from the hassles of paying two different policy premiums.
Secondly, buying a joint life insurance policy is much cheaper than buying two individual life insurance policies.
Another attractive feature of a joint insurance policy is the waiver of premium. Under this feature, the surviving spouse need not pay any premium after the death of their partner.
Couples also have the option to receive the payouts in the form of a monthly income. Most of the life insurance companies provide the monthly income benefit for up to 60 months.
Moreover, beneficiaries of a joint life insurance policies can receive a payout on the death of one of the partners or both. Hence the future of the children can be secured even if both the parents face an untimely death.
As you can see, Joint Life insurance policies offer a myriad of benefits for the dependent children. A Couple can receive double the benefits by paying a single premium. If you are a married couple with dependent children, it is always a better idea to opt for a joint life insurance policy rather than an individual plan.