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Joint Life Insurance Versus Two Single Life Insurance Plans |
By:
Chris Clare |
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Joint Life Insurance versus two Single Life Insurance Plans
Chris Clare
This article is aimed at couples buying life insurance and the benefits over cost of having or arranging two single life plans rather than just arranging a joint life first death plan for both individuals.
Having made the decision that you have a requirement for life insurance, you would be forgiven for thinking that to just arrange one plan to cover the both of you will do the job and you can move onto the next financial thing you need to do. This is not necessarily the end of it and furthermore may not be the best thing for you.
To get to grips with why one solution is better than the other you first have to understand what these solutions are and what they actually mean to you in your financial situation. It has to be said that when a lot of couples are faced with the need for life insurance the instinct is do arrange the cover on a joint life first death basis. This type of plan is simple it insures you for the sum assured and when the first of you dies it will pay out and then cease to exist.
The alternative is to arrange life cover on the basis of two single life plans one plan for each person. The result of this is, if one person dies the plan which they own will pay out. The important thing here is the surviving person still has their own life insurance in tact. This is because their plan was not affected by their partner dying.
A lot of people who arrange life insurance cover on the joint life basis do find that their cover ceases when their partner dies and subsequently are then left with no insurance at all. As a result they find themselves in a lot of occasions requiring life insurance all over again. The problem is if you have grown older during the interim period or have suffered any medical conditions since taking out the original plan getting a new one can be hampered, and in some cases the cost of such cover can be quite considerable higher than expected.
Another benefit of taking out two single life plans is that in the event of relationship separation or even divorce you do not have to split the plan. This would only happen in the event of a joint life first death policy. With statistics showing that about 40% of marriages end in divorce and a greater number of relationships end in separation, trying to separate these plans is becoming more common. In this event, with two single life plans you each keep your own policy.
A lot of people assume that taking out two plans rather one joint is a lot more expensive and therefore unaffordable. This is far from the truth arranging two separate plans over one joint one can invariably only cost about 10% more on the overall premium. When you factor in the increase benefits already stated above an extra 10% is a small price to pay.
One of the most important benefits still not mentioned is the fact that having two plans could result in double the payout. On a joint life first death plan there will only ever be one life insurance payout once the first life assured dies. As two single life plans are written on each individual if both individuals died then both plans would pay out in full. Again when you factor in this can normally only cost an additional 10% extra in premium payments it makes it very financially beneficial.
So to confirm two plans written on single life basis are better than one joint life first death because, they are flexible in the event of separation, they will payout twice the amount on death of both lives assured for normally only about 10% more in premiums. If one person dies the other is not having to sort out life insurance at higher rates due to age or adverse health.
To obtain your no obligation realtime quotations for your single http://www.life-ins.co.uk) life assurance plan rather than joint life first death http://www.life-ins.co.uk) life cover visit life-ins.co.uk This and other http://www.uberarticles.com/?id=36153&b=79 unique content 'life insurance' articles are available with free reprint rights.
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Article Source: http://www.statssheet.com/articles/article61423.html |
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