What are joint life policies?

A joint life policy can be either a term insurance or an endowment / ULIP policy.

A joint life policy essentially provides for coverage for two life’s, typically a person and his/her spouse, where the policy benefits are payable on the first death of one of the two joint life assured.

On survival, the maturity benefits are paid jointly in the names of both life assured.

A joint life policy makes sense when both spouses are dependent on each other and a similar risk cover is required on both to ensure that the family’s financial security is maintained in the event of the unfortunate death of any of the two. In such a case, a joint life policy that makes the benefit payments on the death of any one of the two may turn out to be cheaper than taking two similar and separate life insurance policies.

However, the policy will pay out on the death of the first life assured. In the event of death of both joint life assured, the nominees or next of kin would be paid the benefits only on the first death or of a single sum assured and not twice.
Some policies will offer an Accidental Death Benefit Rider that will cover both Life Assured in the event of death by accident.

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