What Is Joint Life Insurance and When Should You Go for It!
Joint Life Insurance: A Joint Life Insurance can efficiently do this. Joint life insurance is a comprehensive insurance plan. Which gives equal importance to the life of your spouse as well and comes with many benefits. It offers payout on the death of one of the two insured. Or in some cases regular income to Pre-specified surviving family members. Life insurance is something most people have so it’s important to know about the different options you and your partner have.
When should you opt for Joint Life Insurance Plan?
In those families, where both wife and husband are earning, and contributing towards household expenses like loans, and lifestyle expenses, joint life insurance plans hit. In such double income nuclear families, death or disability of any earning member can severely impact the entire family. Therefore the life of both earning members should be covered.
Young couples and non-working life partner:
Young couples with a small kid with outstanding loan amounts can also go for joint life insurance plans. The payout on the death of either partner will be of much significant amount than the amount invested in the policy. Joint life insurance plans cover the life of non-working spouse too. Because of the unfortunate death of a non-working spouse. Taking care of children and other members will be a huge responsibility.
Buying joint life insurance policy for the same couple and for the same amount will be cheaper than buying two separate policies. The monthly premium payments in case of joint life insurance policies are much lower than purchasing two separate policies. So, if you are looking something on a budget, joint life insurance can be the best option for you and your spouse. Plus, the ease of managing and simple documentation process also attracts buyers towards joint life plans.
Various terms and conditions benefits:
Joint life insurance policies come with different terms and conditions, so, before buying one, do check out and compare several options available. Some companies pay out on the first claim basis which means sum assured will be paid on the death of whomever of the two policyholder dies first, and policy will end. While in some cases payout will be on the death of each insured policyholders respectively.
Joint life insurance policies offer multiple benefits. In some cases, on the death of one of the spouse, regular income will be paid to the surviving spouse for a fixed term. This regular income is paid in addition to the death benefit payment to the surviving spouse. In some situations where death has taken place due to the accident, an extra amount is offered along with death benefit. Joint life plans also allow you to add critical illness rider to the base policy.
Comparison between Joint Life and Single Life Insurance:
You should understand the difference between buying a joint life insurance policy and single life insurance policy. A joint life cover will insure both spouses under the same terms and conditions and normally assures only one death-payout. If a couple dies in an accident under a single death payout joint life insurance policy, the beneficiary will receive only single death-related payment. If the couple has individual life insurance policies, then there will two separate death related payouts.
In case of divorce, a joint life insurance policy cannot be divided so before opting for it do not forget to ask your insurance company whether they will provide joint life insurance with optional clauses/riders which provide the right for splitting the policy in separation or divorce situations.
People who are looking for tax benefits under Section 80C and 10 (10D) of Income Tax Act, 1961 can go for Joint Life Insurance. The premiums paid, and benefits received under Joint Life Insurance Plans are eligible for tax benefits.
Additional benefits of New Plans:
Some of newly launched joint life insurance plans offer additional benefits like in-built terminal illness and inbuilt accidental death benefit.
There is definitely a place in our life for joint life insurance policies, but they work best in specific situations. So, talk to the insurance company or your financial advisor to see if it’s the right financial move for you and your family’s protection. Consider all the pros and con before purchasing this policy. So, what are you waiting for? Get yourself a joint life insurance policy today!