To understand joint term life insurance, it is necessary first to note the difference between whole and term life insurance. Whole life insurance consists of politics that have cash value. You purchase a quantity of life insurance in exchange for a premium, and its value can be invested in stock, meaning that it may grow substantially and leave your loved ones with a significant amount of money on your death. Term life insurance involves policies that, for a specific term, will provide a cash-sum in the event of your death, but it will not provide cash value or accrue an increase in value through investment.

Joint term life insurance is essentially term life insurance in a package covering both you and your spouse. In the event of either of you dying, the surviving spouse will receive a cash sum that could be of crucial use if the surviving partner faces financial burdens at a time also characterised by intense emotional vulnerability. But why, you may ask, is this form of policy advisable ahead of individual term life insurance policies or whole life insurance policies, and under what circumstances should one choose it over these other options?

For a start, joint term life insurance, like term life insurance, is generally designed to cover specific costs that accrue over a tangible period of time. Mortgages, childcare costs, or the costs of schooling or university education may all be highly important for families, and if one’s motivation is to ensure these costs are covered in the event of your death, then term life insurance may be advisable. If you and your spouse agree that these family-focused costs are of primary concern should either of you die, then getting individual term life insurance may simply be unnecessary: joint life insurance will provide a single package that provides for your needs.

This may be particularly true when one considers the other advantages of joint term life insurance. Term life insurance, because it does not have cash value, tends to have lower premiums than those associated with whole life insurance policies. It tends to be cost-effective for those who in the short term need to keep their expenditure in check; those who cannot presently afford to be concerned about future values of policy due to the pressing need to get coverage for specific costs at this stage. And joint term life insurance tends to be associated with even lower premiums than those that would result from two individual term life insurance policies. In terms of short-term cost-effectiveness joint term life insurance is well worth considering!

A further advantage of joint term life insurance is its simplicity. You pay one premium for one policy. You do not have to juggle stock associated with whole life insurance, and you know that specific costs you and your spouse are concerned about are covered in the event of one of you dying. If you do seek to make money through investment, note too that many financial advisors suggest that the purchase of term insurance is still viable: simply invest the money you save from lower premiums compared to whole life insurance into alternative investments. You and your spouse may make more money this way than you would by purchasing whole life insurance anyway!