Understanding Joint Life Term vs. Individual Term Life Insurance Policies

Posted on September 22, 2010 and updated October 25, 2018 in Insurance Types, Life Insurance Canada News, Term Insurance 2 min read
Luciano Meirelles  Vov e Vov copy
A few warnings for spouses
considering Joint Life polices.
Photo by Luciano Meirelles

Joint life term policies allow two policy holders to combine their coverage under one plan. In contrast, individual term life policies provide each of the insured’s with individual coverage.

Joint life policies are generally anywhere from 10% to 20% lower in premium then individual life insurance policies. This percentage will be even greater when there is a larger age discrepancy between the two insurers.

Joint Life Term policies cover both policy holders, or both insurers, under one plan. Should one spouse pass away, the other spouse’s coverage would end.

Most of these kind of policies allow the surviving insurer to convert their remaining coverage into a new plan, but this new plan would be assessed at the insured’s current age at the time. This can be problematic if the surviving insured wants to keep their coverage after the policy has been Inforce a number of years.

For example, if a 45-year-old male and a 40-year-old female took out a 30-year Joint Term Policy and the male were to pass away after 25 years, the surviving partner would have to convert their coverage to a new plan at age 65, which makes the premiums substantially higher than the two were previously paying in their younger years.

Individual term life insurance policies cover both insurers and should one insured pass away, the other insured’s coverage remains intact.

For more details, you can contact us at 1-866-899-4849 or visit our Term Life Instant Quote Page.

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