Updated: November 13, 2019

Joint UK Life Insurance Policies

Need a life insurance plan that covers two people? Read out guide to join life insurance to find out how to get the policy you need

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Phil Whitehouse

Author: Phil Whitehouse - Finance Expert

Updated: November 13, 2019

When it comes to life insurance, lots of couples approach us interested in taking out a joint life insurance policy rather than two separate ones – mainly because it tends to be a cost-effective option as far as the monthly cost is concerned.

While joint life insurance could certainly be a consideration, it’s important to know the difference between joint versus single products to ensure you have the right cover to meet both your own and your partner’s needs.

This article covers what joint life cover is, how it works, and the pros and cons of joint versus single life insurance, to help you decide whether it’s a suitable option for you:

What is joint life insurance?

As the name suggests, joint life insurance provides cover for two people such as a husband and wife.

If one person dies throughout the policy term, a payout is made to the surviving person after which time the policy terminates. How much the joint life insurance payout depends on the type and level of cover.

But once a payout is made, the surviving individual will no longer be covered and would need to take out a new policy if they wanted to continue with life insurance cover in their own right.

Although single life cover tends to be a more popular choice, joint life insurance can work out more affordable for some couples – so if you think it could be a suitable option for you, why not find out more? Call 0808 189 0463 or submit an enquiry and we’ll introduce you to one of the expert advisors we work with.

Our advisors are all regulated by The Financial Conduct Authority and so are highly trained and work to strict conduct rules.

Writing joint life insurance in trust

Writing a joint life insurance policy into trust is a legal arrangement that protects your life insurance payout from being included in the value of your estate (your property, money and possessions), and therefore being subject to inheritance tax, and will therefore be subject to inheritance tax if not written in trust.

As well as paying less tax, having your policy in trust can also mean payments to beneficiaries is direct, which can speed up the process.

There are some cases where a policy written in trust may not be suitable for you:

  • If you have no dependents
  • When the payout is assigned to a lender (e.g. mortgage provider)
  • If the policy includes critical illness cover

This is a pretty complex area, so if you want to find out more, get in touch. Either use our online enquiry form, or call us on 0808 189 0463.

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Is joint or single life insurance cover best for me?

Before you decide which type of cover would work best for you, it is important to understand the options available to you: single or joint life insurance, and how they differ.

Single life insurance provides cover for one person only, and if that person dies while the policy is active, a payout of the agreed life cover amount is made to the holder’s beneficiaries.

Joint life insurance payout

Joint life insurance provides cover for two people, and if one person dies during the policy length, a single payout is made to the surviving person and the policy term comes to an end.

If you are in a couple, you might decide that it’s more suitable to take out two separate policies to ensure that the surviving partner is still covered in the event of you passing away.

To help you decide, it might be worth considering the following factors:

  • Do you both need the same level of cover?
  • Who will the payout be going to? (beneficiaries, mortgage lenders etc)
  • What is your budget?
  • Are your needs likely to change in the future?

If you’re unsure whether joint life cover is for you, get in touch and we’ll refer your enquiry to one to the experts we work with.

They will be able to answer all your questions and give you advice bespoke to your specific needs and requirements.

Life insurance for couples

Couples life insurance can vary greatly depending on both your current and future circumstances.

As discussed, it is important to look at your combined situation against a number of factors to decide if joint life cover is a viable option.

Life insurance for married couples

Although joint life insurance may seem like the obvious choice for a married couple, there are some situations where separate policies could be more beneficial.

For example, young married couples are likely to have far more outstanding loans, so a joint policy payout may only cover these sums, leaving the surviving partner without adequate cover for the remainder of their lives.

Can you get joint life insurance if you aren’t married?

Many people assume that joint life insurance is designed solely for married couples, but this isn’t the case; joint life insurance is also an option for unmarried couples and, in some cases, business partners.

Even if you’re not married, taking out joint cover as a couple will give you the peace of mind that your partner is adequately provided for if you were to pass away during the term.

What happens to joint life insurance after divorce?

Typically, joint life insurance policies cannot be divided in the event of a divorce. In these circumstances, there are a few options available to you: either the policy can be cancelled, or one partner can take it over.

This is because the terms of the policy are agreed when the policy is taken out and couples therefore need not have to stay together just to receive the benefits of a policy when one party dies.

If you wish to cancel the policy, you will not receive any refunds of the amounts you have paid in premiums and there will be no pay out of any benefits as you have cancelled the policy early.

As an alternative, one partner may want to take over the joint policy. This might make some sense if you have held the policy for a considerable time and you’re likely to face higher premiums if you take out a new policy, but be sure to seek expert advice before making any decisions.

The partner taking over the policy will be required to pay the monthly premium payments themselves.

If you think your situation is likely to change in the future, it is worth bearing in mind that taking out a single policy at a later date could mean paying higher premiums, as they usually increase with age.

Joint life insurance and critical illness cover

Some life policies, whether they be joint life or single, have additional add-ons, one of the most common being critical illness cover, which can be claimed if one of the policy holders suffers a serious illness such as cancer, heart attack or stroke.

Typically, critical illness can only be claimed once on the policy. So, although the joint life cover will remain, critical illness cover will no longer be included once a claim has been made.

Insurance companies have different definitions and clauses covering critical illness and so it is advisable to talk to a qualified insurance expert about this.

What is a joint first-to-die life insurance policy?

A first-to-die life insurance policy is another term for a joint life insurance.

If you are the first to die, your partner will receive the full payout and the policy will end. The surviving partner will have no life insurance cover, and may wish to take out single life cover.

This kind of life insurance policy is often taken out by couples with a joint mortgage, as it is a good way to ensure that the mortgage can be paid off in the event of either party dying prematurely.

What is a joint last-to-die life insurance policy?

Last-to-die life insurance, also known as “second to die” cover provides a payout to beneficiaries only after the last surviving person on the policy passes away.

It differs from standard joint life insurance in that the surviving partner doesn’t receive any benefits after the spouse dies.

This can help to avoid any inheritance tax, which could be incurred when the first partner passes away.

Again this can be a complicated area and so it may be advisable to talk to an expert about this.

Joint life cover for over 50s

There are some special plans for over 50s joint life insurance which, unlike term life insurance, be set up for the whole of life, meaning the policy lasts up until you die or until the maturity date (usually when you reach 90). When you pass away, your beneficiaries will receive the agreed payout.

Many providers only offer single life insurance policies for over 50s, although there are a few out there who offer joint policies to cover your partner.

The terms of a plan can vary, however, if the surviving partner also requires cover when you pass away, two separate policies might be more suitable.

Should I use an online calculator for joint life insurance?

It is often tempting to use online calculators to compare joint life insurance policies, but these might not tell the full story, and are unlikely to take all your individual circumstances into account.

Most experts recommend that you seek independent financial advice to assess your needs and make sure that you opt for a policy which provides you and your beneficiaries with the most suitable protection.

How do I get the best joint life insurance rates?

Speak to an expert broker who has access to the entire market.

Joint life insurance can be a great, cost-effective option for many people, but as we’ve discussed, there are many variables which impact how much you can expect to pay for this type of cover.

To get the best joint term life insurance rates, speak to a whole-of-market insurance broker. The experts we work with will not only find you the most suitable and best value deals for your needs, they’re also on hand to answer any questions.

You can make an online enquiry, or give us a call 0808 189 0463 for a free, no obligation chat.

Ask a quick question

We can help! We know everyone's circumstances are different, that's why we work with brokers who are experts in life insurance. Ask us a question and we'll get the best expert to help.

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Phil Whitehouse

Phil Whitehouse

Finance Expert

About the author

In 2014 Phil set up and is Head of MCI Club that provides a range of mortgage club support services, including extensive mortgage and insurance panels primarily to Directly Authorised users of The Mortgage Keeper CRM system, which in turn is part of DPR Consulting Group.

Immediately before setting up MCI Club, Phil started a range of financial services support businesses, and previously ran TMA Mortgage Club for five years and prior to that looked after supplier relationships for Pink Home Loans from 2001 until 2007.

His early career was spent in the retail banking sector, notably with Halifax where he held a number of Management roles.

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FCA Disclaimer

*Based on our research, the content contained in this article is accurate as of the most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms that are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs.

Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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