Choosing between single and joint life insurance is an important decision that depends on your unique circumstances. At Ascot Mortgages, we can offer expert advice on the best option for your situation so you can make an informed decision.
or
As the name suggests, a single life insurance policy insures one person so that if they die during the policy term, a lump sum is paid out to their designated beneficiaries. The policyholder will decide on the length of the policy, the amount and who receives the payout.
Many couples opt for two single life insurance policies, meaning that if one of them dies, the other still has their policy in place. It also means that if one person wants to increase or change their coverage over time, they have the freedom to do so without affecting the other.
As the name suggests, a single life insurance policy insures one person so that if they die during the policy term, a lump sum is paid out to their designated beneficiaries. The policyholder will decide on the length of the policy, the amount and who receives the payout.
Many couples opt for two single life insurance policies, meaning that if one of them dies, the other still has their policy in place. It also means that if one person wants to increase or change their coverage over time, they have the freedom to do so without affecting the other.
A joint life insurance policy insures two people under one contract so if one person dies, the other policyholder receives the payout. As it’s a joint policy, it involves one application and one monthly payment rather than one per person.
It’s important to note that a joint policy only pays out a lump sum once. Most joint policies pay out upon the first death, leaving the surviving partner with no cover in place. There are also second death joint policies which pay beneficiaries once both people on the policy have passed away.
Although single and joint life insurance policies work differently, they do have some similarities. For example, they both:
When deciding between single or joint life insurance, it’s important to consider the pros and cons of both, so you can decide whether one joint policy or two single policies is best for you and your partner.
Joint life insurance covers two lives but the policyholders don’t have to be married or even in a relationship. If the other person on the policy, regardless of their relationship to you, would suffer a financial loss if you passed away, it’s possible to get joint life insurance. It’s often a good option for those with shared financial responsibility, such as a joint mortgage. The key is to assess whether a shared policy makes financial sense for your specific situation.
It can be difficult to decide whether joint or single life insurance would be the best option for you and your partner. You’ll need to start by assessing your current circumstances and any changes that might happen in the future. Below are a number of factors to take into account when making your decision:
When you take out a joint policy, only the other policyholder will receive the payout if you pass away. Therefore, if you have no other dependents, it can be a great option that simplifies matters. However, if you do have other dependents, such as family to support, two single policies may suit you better. As a joint policy ends once one person dies, you would need to take out a separate policy if you wanted to support any children or relatives financially.
The cost of premiums is often an important factor when deciding on a life insurance policy. As mentioned above, single policies tend to be pricier as they provide more coverage, flexibility and two potential payouts. Joint policies are generally more affordable but may be less effective if both partners need substantial cover. It can be helpful to decide a budget and get quotes for both single and joint policies so you can find the most affordable and appropriate option for your needs.
Generally speaking, two single life insurance policies offer more flexibility as, if your circumstances were to change and you were to separate, you’re not linked with a life insurance policy. It also allows you to decide on a different amount or policy term length than your partner, which can be especially useful if your financial situations, health or long-term goals differ.
With separate policies, each person can adapt their cover as life changes – whether that’s buying a new home, having children or adjusting to a new income level.
The right policy for you may also depend on what your financial obligations are. For example, if you have a joint mortgage, a joint policy can ensure the surviving partner isn’t left struggling to cover the repayments alone. This can work especially well if you’re on similar incomes and can afford to pay the same in premiums. However, if one partner carries most of the financial responsibility, separate policies might better protect each person’s contributions and provide more tailored support.
If you have a joint policy with someone else and you divorce or separate, you’ll need to contact your insurer to understand your options. In some cases, the policy can be split so neither policyholder has to go through underwriting but this depends on the provider. If your policy doesn’t offer this, there are a few options available:
In some cases, it may make sense to continue with the policy, for example if there are shared financial obligations, like children or a mortgage. Although, it’s important to note that it will be the other policyholder rather than any other dependents that receive your payout if you pass away.
It may be possible to transfer the policy to just one person. However, this may be hard to negotiate as they will need to keep paying the amount you were both paying before. For this to happen, you will both complete and sign a legal document which is then registered by your insurer.
You may opt to cancel, meaning neither of you are covered anymore. This is probably the simplest option but there are downsides. You will likely lose the money you paid into the policy and as life insurance policies increase in cost as you age, you’ll likely have to pay more for a new single policy.
Yes, although it can be more difficult to find joint life insurance for over 50s, it’s not impossible. For example, you may be able to take out decreasing life insurance which can be helpful if you’re hoping to cover mortgage repayments. Decreasing life insurance typically reduces at roughly the same rate a mortgage does, meaning that if you die five years into the policy, your partner would receive more than if you died 10 years into the policy.
There are also life insurance policies specifically for over 50s, such as over 50s fixed life insurance, but this tends to be a single rather than joint policy. This is a whole-of-life policy and can be a good way to financially support your loved ones and contribute to funeral costs once you pass.
Ultimately, your choice should reflect your financial needs and future plans. Here at Ascot Mortgages, we can help you compare different options, offering expert guidance on the best choice for your circumstances. Contact us today to find out more.
Get things moving, apply for a protection.
Free unbiased protection advice is just a phone call away
Contact Us
Cookie | Duration | Description |
---|---|---|
cookielawinfo-checkbox-analytics | 11 months | This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics". |
cookielawinfo-checkbox-functional | 11 months | The cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional". |
cookielawinfo-checkbox-necessary | 11 months | This cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary". |
cookielawinfo-checkbox-others | 11 months | This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other. |
cookielawinfo-checkbox-performance | 11 months | This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance". |
viewed_cookie_policy | 11 months | The cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data. |