Joint Life Policy - Types & Benefits

It takes two to make a home. That’s why Joint Life Policy offers financial security to the spouse of the policyholder. Untimely deaths of a partner can leave their spouse with no support whatsoever.

That’s why the joint life insurance policy gives financial protection to both partners in marriage. Joint life cover is a great way to combine the values of both partners under one umbrella. Also, a joint term cover offers higher financial security to your children.

Here’s everything you should know about joint-term life insurance.

What is a Joint Life Policy?

A joint life Insurance policy treats both partners as policyholders and provides financial security to both of them. In an uncertain future, keeping your spouse’s financial life secure is needed.

A joint life policy is a single plan that covers both the wife and the husband whether both of them are earning or only one. This way even the homemaker’s human life value is covered by the family.

For example, if a couple have a joint life insurance and the husband is the first one to die, the wife will receive a support amount from the joint life policy.

Where a single life policy would have expired, joint life insurance will continue to cover the other spouse until the expiry of the policy. The policy provides financial support to the remaining partner regardless of their working status.

Thus, if the surviving partner also suffers an untimely mishap, the children will still have adequate financial support. They can continue their lives and meet their future goals with the same financial support as they would have with both parents in their lives.

How does Joint Life Policy Work?

Once you buy a joint life cover policy, your spouse is covered in the same plan. Single-life policies will cover only one person under one policy. Joint life insurance is a great way to look out for your partner after your demise.

The policy provides an assured amount to the living partner after the demise of the other. The homemaker spouse will have coverage of up to 50% of the sum assured amount for the working spouse.

• If you have bought the joint life insurance policy, after your death, your spouse will receive the death benefit sum assured on your life. You can select the mode of disbursement of the death benefit as:
  • Lump sum amount
  • Regular monthly income
• A joint life cover plan works on a first-death basis. If a partner dies an untimely death, the life cover for the other person continues after the payment of the death benefit of the deceased spouse. This is regardless of the working or non-working status of the surviving spouse.
• In a very unfortunate case, where both partners are unable to survive the unfortunate situation, the insurance amount is credited to the policy’s beneficiaries or listed legal heir.
• Only the insured amount is paid to the living partner and no additional benefits can be claimed by the spouse.
• Joint life insurance helps the homemaker spouse with a life cover. The homemaker spouse is eligible for a life cover equal to 50% of the sum assured for the breadwinner spouse.
• In the case of the death of both partners in a joint life policy, the legal heir will receive the death amounts for both partners’ life cover.
• Joint life insurance provides insurance coverage to the surviving spouse regardless of their employment status. If the policy offers a premium waiver option, the life cover of the surviving spouse will continue without additional premium payments.

Types of Joint Life Policy

There are two options in the joint life policy for you to buy. Depending on your conditions, you may opt to buy either of them.

1. Joint Term Insurance Plan

This is the regular term life plan which you and your partner can hold together. This amount can be claimed by either of you if the other person faces untimely death. This policy requires you to pay a premium for a fixed period.

The joint-term life insurance expires after the death of both policyholders or at the end of the policy term, whichever is earlier.

• Joint life-term insurance allows you to ensure adequate financial protection for the family
• Joint life term insurance premium is one of the lowest among other life insurance options
• You can add benefits like accidental disability and critical illness cover for the primary holder or both spouses when both are employed

2. Joint Endowment Plan

In a joint life endowment plan, both policyholders have to pay a premium amount for a fixed period. However, after the expiry period of the policy is reached, both partners will get the guaranteed benefit amount.

• The joint endowment life insurance works similarly to an endowment plan. However, this plan covers both partners.
• If you buy the joint life endowment plan, after the demise of one partner the surviving partner receives the death benefit. But the policy with life cover for the surviving partner will continue until:
  • The death of the partner within the remaining policy period
  • The expiry of the policy
• Your spouse will receive the insured money after the maturity of the plan.
• If you have opted for a premium protection benefit in the joint life endowment plan, the death benefit payments will not affect the maturity value.
• After the death of a policyholder, premium payments for the life cover of the surviving spouse will not be required.

3. Joint Whole Life Insurance

In joint whole life insurance, the policy works similar to a joint endowment policy. However, the cover is expected to continue up to the age of 99 (or 100) of the surviving spouse.

• The joint whole life insurance is a great way to leave a legacy for the legal heirs, as the policy will continue until your natural demise
• The policy will pay the death benefit on the death of either of the partners
• It also works as an asset during the retirement period as it acquires a cash value

joint whole life insurance policies are more popular in the US and European markets where it is also known as permanent joint life coverage.

Why should you Buy Joint Life Insurance?

Joint life policies offer unique benefits to policyholders and their families. Some of the most important reasons to buy joint life insurance are listed below:

1. Low-Cost Premium

You will have to pay comparatively cheaper premiums if you buy a joint life policy. These are often considered economic policies. You can buy joint life insurance without having to struggle with financial difficulties while paying the premium.

2. Extra Source of Income

If you are a surviving policyholder, policies like iSelect Smart360 Term Plan from Canara HSBC Life Insurance offer the benefits of regular income for a period.

This will help you and your household with financial management by providing financial security and extra income in absence of your partner.

3. Simpler Life Cover Management

A joint life policy is a single policy covering both spouses. If both of you are earning and contributing to the policy you can both claim the available tax benefits.

However, both of you will not need to have separate paperwork for it.

Also, the policy will continue with the life cover for the surviving spouse without the need for additional premiums if one of the spouses dies untimely. This is especially helpful for the homemaker spouse.

4. Cover Homemaker Spouse

Generally term life cover is not available to non-earning members. However, a homemaker spouse can have a life cover under the joint policy with his/her working spouse.

Premium bonuses or waivers are also provided to you by some of the policies after the primary assured’s death. Various types of Joint Life Policies have their benefits and you can understand those benefits and utilize them accordingly.

Who can Buy Joint Life Cover?

You can buy a joint life cover if you are a married couple. These policies waive off further premiums if one of the policyholders dies an untimely death. The other is entitled to complete the policy term with their share of the life cover.

However, this insurance policy is also very suitable for business partners. You can buy the joint life cover with your business partner to protect the company’s interests. In case of the untimely demise of either of the business partners, the other will receive a fund which can be useful to settle the succession of the deceased partner.

If you and your partner are worried about the financial security of your child after your demise, you can buy joint whole-life insurance to make sure your child remains financially protected. This money will surely help the child’s future expenses like educational fees, house maintenance, healthcare, and so much more.

Joint Term Life Insurance from Canara HSBC Life Insurance

Canara HSBC Life Insurance offers iSelect Smart360 Term Plan. You can purchase this term life insurance online, and it offers the following features for joint holders:

    - Cover for homemaker spouse
    - Critical illness and accidental disability benefit riders for primary holder/working spouse
    - Option to increase the cover for the primary holder/working spouse in the policy after purchase
    - Death benefit payment as a regular income option