Is it Better to Have Joint or Single Life Insurance?

A guide to the difference between both policies.

author image - cai

By Cai Bradley

on Friday 22 November 2019

Couple holding hands in street

If you’re in a relationship – married or not – taking out a joint life insurance policy may be something that you are considering. But, is it more beneficial to take out single or joint life insurance in the UK?

In this guide, we explain the benefits of both policies and discuss under which circumstances it might be worth taking out joint life cover.

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What is single life insurance?

What is joint life insurance?

Is it better to have joint or single life insurance?

Benefits of joint life insurance

Choosing the best life cover for you

What is life insurance?

Life insurance is an agreement between a policyholder and an insurance provider, where the insurer is required to pay out a pre-agreed lump sum to the policyholder’s chosen beneficiaries if they should pass away during the policy’s term.

In turn, the policyholder must pay the insurance company in the form of monthly premiums.

Policies can cover a specific term or they can last for the whole of your life, which you can learn more about in our guide to the different types of life insurance.

The payout is there to provide loved ones with financial security in the event of the policyholder’s death, and can also be used to:

Single cover is the standard form of life insurance, with joint cover being an alternative option for those looking to have just the one policy to cover both themselves and their partner.

What is joint life insurance?

Joint life insurance cover, in short, is a life insurance policy that covers two lives, rather than just one.

Although it covers two people, joint life cover will only pay out once and does so when one person passes away. Should one of the policyholders die, the second individual involved in the policy is no longer covered as the payout will have been released - they will then, unfortunately, have to take out another life insurance policy.

Is it better to have joint or single life insurance?

There is no ‘better’ or ‘best’ option for all people; each individual’s situation differs, meaning that the most suitable type of life insurance for them also differs.

Advisors typically recommend that a couple should get two separate life insurance policies for most situations, but not all. There are certain circumstances under which joint life cover would be more beneficial than two single policies, as outlined below.

When is it best to get joint life insurance?

Joint life insurance works best if the only reason for you taking out a policy is to cover your mortgage. Let us explain further.

Life insurance for mortgage cover: Joint vs Single

Decreasing term life insurance policies are the best type of cover for mortgage repayments.

The lump sum payout decreases over time in line with your repayment mortgage, which also decreases over the years - the more you pay off your mortgage, the less cover you need.

Read more: Decreasing Term Life Insurance

But should you get a joint or single decreasing term policy?

Joint decreasing life insurance

Your mortgage only needs to be paid off once, so with that being the case, you might not want two payouts if the only purpose of your life insurance policy is to pay off your mortgage.

Joint decreasing term life insurance is a type of policy available to help cover your mortgage and means that your repayment balance will be cleared if either of you passes away during your policy term.

Single decreasing life cover

If both partners take out a single, individual life insurance policy each and if one person dies within the policy terms, the other is still left with a life insurance policy, so they still have cover in place and the mortgage would have been paid off with the deceased partner’s life insurance payout.

This sometimes works out as a cheaper option, because if your partner dies and you’re left with no life insurance policy (because you had joint cover), then you’ll need to get another policy, which will probably work out more expensive as you are older and, perhaps, not as healthy as you were when you were younger.

It is also important to think about this situation: if you have children and you both should pass away in an accident, for example, then they would only receive the one payout, whereas if you had individual policies, they would receive more financial support from two payouts.

To find out more about the options best suited to you, and for life insurance advice tailored to your personal situation, talk to a Unite Life advisor today for free and with no obligation.

Alternatively, for more information on whether it could be the most ideal life insurance for couples, head over to our complete guide to joint life insurance in the UK.

Benefits of joint life insurance

The benefits of joint life insurance are:

  • It pays out irrespective of which partner passes away
  • It is ideal for mortgage cover as it pays out just once
  • It is usually cheaper than taking out two single policies
  • It is ideal for couples with no children*

*Although it may seem a downfall that the surviving partner is not covered once the payout has been released, this could make it an ideal policy for couples without children.

As the surviving partner has no children or dependants to provide for, as well as no mortgage now that the joint policy has covered it, there’s a strong argument that there is no real need for them to have cover.

Choosing the best life insurance for you

With so many different types of life insurance policies available, it can be difficult to choose the best cover for your individual situation.

When you think about taking out joint life insurance, consider your:

  • Budget – Can you afford the premiums and is the payout worth it?
  • Required level of cover – What (or who) do you need to cover? A mortgage? Your children?

There are many factors to take into consideration when choosing the best life insurance to suit your individual needs, which is where our team of advisors here at Unite Life can help.

We work with a range of top life insurance providers in the UK to help find you the best deal possible, tailored to fit your situation, preferences and requirements.

To get in touch, simply call us on the number below or complete our short contact form and one of our friendly advisors will be in touch at a time convenient for you.

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