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One Life Insurance Policy – Covers Two People

Yes, you can own a single life insurance policy that covers two people.  Purchasing this type of insurance is very common when you are either in business, or you have a mortgage and wish to cover both spouses.

In the simplest of terms, it’s called a “joint and first to die” policy. The intent behind this policy is to provide coverage where the death benefit is needed on both people, but after a death benefit is paid, the survivor does not require coverage on themselves.

Examples might be where a death benefit is required to pay off a personal mortgage on a home; or a business a policy might be needed to fund a buy sell agreement at the death of one partner.

From a premium perspective the cost of this coverage is a little less expensive than buying one separate policy on each person. It’s also interesting to compare the pricing with banks where it is common for people to buy coverage to cover the mortgage. Recently I was advising two clients (male age 41 and female age 40) where the bank was charging $177.00 per month for $400,000 joint and decreasing term. As a private plan, we were able to offer a premium of $81.00 per month for $400,000 on a level 20 year joint and first to die policy. This was a direct savings of $1,152 per year for 20 years.

If you live in Nova Scotia and you have a mortgage, make the call to your bank and ask what you are paying. Then call us. If you find this blog interesting, send it to a friend or family member.

corry@maritimewealth.com
902-444-7000

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