Thinking About A Survivorship Life Insurance Policy
A survivorship life insurance policy is sometimes called a second-to-die or a survivor insurance policy. It is basically one policy that insures two people and is usually spouses. This means, then the first spouse dies, there are no monies/benefits paid out. The life insurance policy remains in effect and premiums are still paid. The death benefit is not paid out to the beneficiary until the death of the second insured covered under the life insurance policy.
Survivorship Life Insurance is also a type of permanent life insurance protection. It can be purchased as a whole life policy or a variable life insurance policy.
Some Uses Of Survivorship Life Insurance
This type of life insurance is used to ensure that the loved ones are provided for after the death of both spouses who are covered under the policy. If both spouses die, the survivorship life insurance policy will be helpful for families who have children that need to be cared for.
Also, the suvivorship life insurance policy benefit can be used to pay or help pay for estate taxes. In this case, the monies for inheritance are not spent trying to cover the expense of estate of income taxes.
This type of life insurance policy can also be a good decision for those couples where one spouse is not in good health and all other insurance types are too expensive to purchase for coverage. The insurance company may be a bit more forgiving since the policy is covered with two individuals and the other spouse is in relatively good health standing. This will be beneficial to the spouse who may not be in a good of health as the other, which in turn will “balance out” the risk to the insurance company who will be insuring these individuals.