Mortgage Protection is one of the life insurance products which can be set up on a Joint Life basis but it’s not just your mortgage that needs protection, you might need it too.

Life insurance gives a financial safety net when it’s needed most. If you have a partner or children, it’s worth considering how life insurance can provide them with financial security. If the unthinkable happens and you or your partner passes away, a joint life insurance policy can help look after your family.

How does joint life insurance work?

Put simply, joint life insurance covers two people and pays a lump sum if one person dies. You can decide the term of the policy depending on what makes sense for your situation. For example, if you want the term to match the length of time it will take your child to finish their education with the anticipation that they will be financially independent thereafter. There is also a whole of life joint insurance option which covers you for life, rather a specified period as is the case with term insurance.

You can also choose the amount of cover you want when you decide on the right policy for you, although generally the amount must be the same for both people. There are some joint life policies where the amount of cover can be different for both people, this depends on your product provider.

If one of the people insured on the plan dies, the surviving partner will receive the payment. However, if it is a ‘last survivor’ policy, the payment is made to the named beneficiary. The payment is paid only to a beneficiary if the plan is set up in trust that names a beneficiary, trusts are usually set up at inception of the policy.

Why might you need joint life insurance?

Here are some common situations where you and your partner might take out a joint policy:

Joint mortgage life insurance

A couple who are taking out a mortgage together often choose a joint mortgage life insurance policy. Your lender requires that you take out a mortgage protection policy designed to pay off your remaining mortgage if one of you should pass away. This means the other person has financial support at such a difficult time.

Joint Specified Illness Cover

You can also take out a specified illness policy to get cover for more than just death. This means you get a payment if you or your partner are unable to work due to a specified illness. A lump sum is paid if a policy holder is diagnosed with an illness covered under the policy terms & conditions.

Joint Whole of Life Insurance

This can be a more expensive policy, but it pays out when one of the people named on the policy dies and there are no term limits.

Should I choose joint or single life insurance?

Choosing the right policy depends on your circumstances, what you want to achieve with a life insurance policy, and your budget. Always consult an experienced financial advisor to ensure that you get adequate cover but don’t pay more than is necessary.

Discover some of the benefits of a joint life insurance policy

• Cost: Joint life insurance can be less expensive than taking out two single life insurance policies or dual life insurance.
• Convenience: One regular payment and one policy can be easier to manage.
• Protect your partner: A couple without children may choose a joint life insurance policy to cover their debts or relieve the financial burden on the surviving partner.
• Reduce risk: Business partners can reduce each other's financial and legal risk with joint life insurance. If the next of kin is asking for their share of a business, a joint life insurance payout could make a major difference.
• Cover inheritance tax: A joint life insurance policy could also be used to cover the cost of inheritance tax. You can set it up so that your children receive a payment when the surviving parent dies. Section 72 policies can be used so your children won’t inherit a large tax bill with their inheritance.

Benefits aside, it’s important to consider that in the case of joint life first death basis, the surviving person will no longer have cover once a joint life insurance policy pays out.

What else do I need to know?

Honesty leads to the best policy

The cost of joint life insurance depends on things like the product you choose, your age, your health, the term, smoking status, and the level of cover. It’s very important to be honest when taking out life insurance. Hiding the fact that you’re a smoker or have heart problems may get you a cheaper premium now but it can cause problems for your partner in the future if it comes to a claim.

You can have more than one policy simultaneously

You could take out a joint life insurance policy alongside an existing single life insurance policy or dual life insurance policy. It’s important to chat to your other half to discuss your existing cover, your savings, and what level of cover you both are comfortable with.

If joint life insurance is something you want to learn more about, fill in the callback form at the bottom of the page and one of our financial advisors will get in touch. You need to be eligible to take out joint life insurance, you can discuss your personal circumstances and get expert advice for you and your family.