I am 32 years married and residing in Gulbarga with a 2 year old son. I and my wife want to avail a term life insurance plan. I want to avail individual term life insurance plans for both of us, but my wife wants to avail joint term life insurance. I am confused. Is joint term life insurance good for us? Please advice?
A joint term life insurance plan allows you and wife to buy a single term life insurance plan to cover both of you. Some joint life term policies pay out on first claim basis, i.e. the sum assured is paid on the death of whomever of the two policy holders dies first and the policy ends thereafter. However, in case of certain other joint life policies, there is a payment on the death of each of the two insured respectively. It is not wise to avail a joint term life insurance plan: 1. Few insurers offer joint term life insurance, so your choice is limited. 2. Cost of individual insurance is not very different from joint term life plans. 3. In future if you decide to discontinue the joint life cover, then both lives are uninsured. You cannot leave out just one life. 4. After paying-out on the first death, single pay-out plans leave the surviving policy holder without any life cover. Buying life cover later in life will cost the surviving spouse more because of the age factor and also because the surviving member may have developed some health-related problems by then. If you must take joint term life cover, opt for a dual death policy. In a dual death policy, coverage continues for the second insured life. So, in case of death of both parents, the childwould receive the dual sum assured proceeds.