When you get married, your life changes almost completely. From now on, every decision you make will affect not only yourself, but also your spouse.
From now on, you need to plan for your shared future. From simple problems to tough questions like "What will happen to my spouse if I die?". You'll probably want to ignore this seemingly bad point, but honestly, you'll want to listen to one of the solutions to protect the future for both of you - like choosing a couple's life insurance plan , if the worst happens.
Why Couples Need Life Insurance?
Married couples or domestic partners often share financial responsibilities, such as a mortgage or a co-signed loan. If you pass away suddenly, the burden of these shared expenses falls on your spouse - unless you have life insurance or another large enough financial backup.
Thus, life insurance is a financial relief for your dependents should the unthinkable happen, providing them with enough money to live comfortably. They can use the amount of the death benefit to cover daily living expenses, pay off a mortgage or pay for school expenses.
Of course, you wouldn't want those closest to you to experience additional financial hardship beyond the tragedy of bereavement. Fortunately, in this case, the financial hardship is easily preventable.
When to buy life insurance as a couple
Life insurance is hardly a topic for a first date, but it's certainly something you might want to talk about when approaching a major milestone - like when you start living together or get married. . From now on, every major or financial decision - such as buying a car, house or taking out a loan - will involve two people. How can you insure your future against the mishaps in life?
At this time, life insurance is an optimal solution for your family. And the best time to buy it is when you are young because the premium is low . In fact, the premium for young, healthy people can be as low as the cost of a cup of bubble tea per day!
Types of life insurance for couples
Buying life insurance for a couple is not entirely different from buying a life insurance policy - as a single person. You will need to make sure your life insurance policy adequately protects your loved ones.
Basically, you have 3 options:
- Single life insurance
- General life insurance
- Combined life insurance
Single life insurance
A single life insurance policy covers only one individual and is not tied to the insured's marital status. In the event of the death of the insured, the insurance company will pay the death benefit to the beneficiary.
In the case of term life insurance , the beneficiary receives payment only if the insured dies during the term of the life insurance policy. In contrast, whole life insurance does not have such limitations. Accordingly, the insurance company pays the proceeds from the policy to the beneficiary whenever the insured dies, as long as the policy is still in force.
General life insurance
Universal life insurance is built for both. It covers both but only requires one contract. However, the insurance policy pays only once and coverage ends when the insurance company issues the payment.
Accordingly, those looking for life insurance for young married couples may find a joint policy a good option, as it is often cheaper than two separate policies.
Combined life insurance
Combination life insurance involves combining two individual life insurance policies into one.
So how is it different from general life insurance?
Well, life insurance companies often subsidize the cost for couples who combine their life insurance policies into one. You can cut your insurance costs by up to 5% - which is no small amount considering the long-term premium.
A combined life insurance policy works quite similarly to two individual life insurance policies. This means the contract will cover both people and grant double death benefits.
How much life insurance is enough for couples?
There's no one-size-fits-all answer because every couple's capabilities are different - so are their life insurance needs. In general, your spouse's life insurance policy should provide enough coverage to cover existing debts, income, mortgage, and schooling....
What type of contract is best for you and your spouse?
In general, separate term life policies are a better option than joint policies for couples. That's because term life insurance policies:
- More affordable
- Offers more flexibility on how long the policy will last
- It doesn't matter if the couple decides to break up
If two people don't live together anymore, a joint contract can complicate things. With few exceptions, such a contract cannot be divided. So, in the event of a divorce, couples have two options:
- Cancellation and redemption of life insurance
- Let a partner take over the contract
However, universal life insurance can prove useful in certain situations, such as when one partner's health prevents them from being eligible for a separate life insurance policy.
Life insurance for stay-at-home parents
Life insurance is often considered an income substitute. This makes many people think that the stay-at-home parent doesn't need it. But that's not necessarily true. Maybe stay-at-home parents don't contribute to the family's income, but they bring many other values such as: babysitting, housework - something that needs to be replaced if something happens to them.
Therefore, consider buying life insurance for your spouse, even if they don't make a steady income.
Moving in with a partner or getting married is an important milestone. Even if you're in the best part of your days because of this event, don't forget to do something even more important - planning for the future. It is to be prepared for unexpected circumstances, including death. This is also why life insurance was born and choosing a life insurance plan for couples is an extremely important first step that you will want to be well prepared for!
