One of the main reasons why affluent married couples purchase a second to die life insurance is because it is the safest way to provide financial protection for their families (especially the children) after their death. This kind of insurance can also be referred to as last to die life insurance policy, survivorship insurance policy or joint life insurance policy.
The second to die insurance policies are different from the traditional life insurance policies because they are meant to ensure two people (customarily couples) and the benefits only pay out when both spouses die. However, to properly set up your last to die insurance, you will have to purchase a permanent life insurance policy. This post is meant to help you carefully think things through before you can finally purchase a second to die policy.
Can you afford it?
Knowing how much insurance you need not enough. You also need to consider your ability to pay off the required premiums. Thus, though you might be interested in a whole life insurance cover, you might be forced to reconsider your options if your preferred options seem too expensive for you. the only way to ensure that you stay insured is by getting what is currently within your means.
Is it worth it?
Sadly, there is a misconception that life insurance policies must be everyone’s selection. However, as much as second to die insurance policy plans have proven to be helpful to children once their parents die, it necessarily doesn’t make it mandatory. For example, if you are not married or do not have any heirs living on your income, then you may not require the second to die insurance.
How much cover do you need
When it comes to insurance covers, the rule of the thumb is to get up to 10x your yearly income. But then again, for you to know exactly how much insurance you require, you must have your reasons for choosing this kind of insurance policy. Once you have the why answered, then you will know how much you need.
In addition to this, you should also think about what your choice of insurance is supposed to pay for. For instance, in this case, second to die insurance is meant to pay for estate taxes once you are dead and also help keep your children financially stable in future.
Who to buy insurance from
If truth be told, shopping for insurance products is not an easy to do thing. Therefore, do your homework before purchasing insurance policy plans from any company. If possible, get recommendations from friends and/or relatives who have bought policies from the same company.
You can also get in touch with previous clients from the same company. And in the process, be sure to ask them what they like and don’t like about their insurance provider. Find out how efficient the company services and customer care were according to the clients. At the end of the day, you should be getting your insurance from reliable, reputable and above all from a company that can afford to pay your claim.