Thinking about getting a joint life insurance policy. These are the things you’ll need to know.
Perhaps you’re married. Maybe you’re an established couple. Either way, you already share everything so why not split a life insurance policy?
Thing is, you could but as with everything it’s got it’s pros and cons, so let’s explain it so that you can make an informed decision if you think it sounds like the right thing for you.
One policy usually means one payout
Joint life insurance is a type of life insurance policy that covers two lives under one policy. When one of the insured passes away, the death benefit is paid to the surviving person or to a designated beneficiary.
The biggest pro of a joint life insurance policy is that the premium tends to cost less than it would for each partner to have their own life insurance policy, especially if both of them are young and healthy at the time the policy is taken out. This is because the insurance company only has to pay out one death benefit.
As far as the cons go, there are a few of them. For starters, as we’ve mentioned, you’ll only receive one lump sum payout when one of you pass away. Secondly, most insurance companies in South Africa don’t offer joint life insurance policies so you’ll have fewer options to choose from. Also, it can be difficult to make changes to the policy if you had to divorce or split up. In most instances, one of you would have to take over the payments to retain the benefit leaving the other person uncovered. Then, that uncovered person might struggle to get their own life insurance policy if they’re over the age of 65 or be faced with higher premiums if they developed a health condition after buying the initial joint policy.
Ultimately, if you are not married or in a committed relationship, you may be better off getting your own individual life insurance policy.
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What other life insurance options could work for couples?
Another way to protect your partner is to encourage them to take out their own life insurance policy. Alternatively, you could add them as a life insured to your insurance policy. This is how we like to do it at MiWayLife. This means that while your premium will increase with every life insured, you’re still only paying one premium. In this case, as your partner is also insured, should either of you pass away, a lump sum will be paid out to the beneficiaries of their choosing. Many couples go this route – having one life insurance policy that covers both of their lives and listing each other and their children as beneficiaries.
You’ll also get to enjoy more flexibility. In the same way that you can add your partner as well as wider family members as additional lives to your policy at any point (provided they’re not older than 65), you can also remove them at any time. Life is always changing and nothing stays the same which is why we believe the best life insurance policy should be able to evolve and grow as you do. So, why not get a quick quote today?
Did You Know:
You can now take out life cover with us online in a few simple steps. No calls and no agents! Make sure to take care of those you love today by buying MiWayLife cover online.
Terms and conditions apply. Eligibility, cover and benefits are determined on individual risk profile. MiWayLife is an authorised FSP (No. 45741) and its product offering is underwritten by Sanlam Life Insurance Limited, a registered long-term insurer. MiWayLife is a division of Sanlam Life Insurance Limited - Reg No. 1998/021121/06