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Joint Life Insurance for Married Couples

Life Insurance occupies a niche status as a component of financial planning because it caters to the specific needs of an individual with diverse goals and objectives. The multiplicity of plans and customization enables the insured to secure the family's financial future, safeguarding them from the sudden blow that the breadwinner's death entails.

Concepts are changing from the traditional perception of insuring only the primary breadwinner, with the women contributing to the household economic sphere substantially. In case both partners are working, the household economic burden is shared. Even for a homemaker, the value of her contribution in economic terms is significant.

Considering the emerging scenario Joint Life Insurance is a necessity, providing life risk cover to both the partners in a single policy.  

What is Joint Life Insurance?

A single-life insurance policy covering both partners in a combined premium is Joint Life Insurance. The policy functions like any other life insurance plan, other than the fact that two lives are covered. Here a nominee is redundant as both the partners are owners, as well as beneficiaries. The spirit behind Joint Life Insurance is that both the partners are equally important. However, it operates on the principle of the first-death basis. If either of the partners meets with premature death, the death benefit claim is settled in favour of the surviving partner.

Types of Joint Life Insurance

The concept of Joint Life Insurance does not restrict the choice to the prospective policyholder as is a general perception since the only difference is that the plan covers two lives instead of one.

Joint Term Plan:

It is a pure risk life insurance policy primarily meant for future financial protection. On the demise of any one of the insured, the death benefit is paid to the surviving partner, and the cover expires.

Joint Endowment Plan:

By nature, such plans include savings element, and the money grows over time. There are both death and maturity benefit components in the plan. The plan promises to pay assured sum to the policyholders on the expiry of the policy term, even if one of the partners passes away. On the demise of either partner, death benefit cover is paid, and the policy continues till the end of the policy term culminating in payment of promised maturity .benefit. However, the premium is waived after the first death.

Joint Life Insurance Plans

Though the concept is evolving, there are several Joint Life Insurance Plans in the market. Choosing the best among them is a difficult task. However, considering the options and variety in them, the following can be deemed to be the best Joint Life Insurance Plans at present.

Among the plan-specific features, the uniform tax savings apply to all life insurance plans. As per the Income Tax Act, 1961 premium is deductible up to a maximum of Rs 1.5 Lakh.

ABSLI LifeShield Plan

It is a pure risk protection plan with eight options. The plan's key highlights are cover for a spouse, life stage benefit, terminal illness benefit, the return of premium, and multiple payout choice as per the policyholder's convenience. As per the policy, 50% of the Sum assured applies to one's spouse. However, this provision is available only when the Sum assured is above Rs 50 Lakh.

In case of the death of the primary insured life, the Sum assured will be paid to the secondary insured life, and future premiums will be waived. If the primary policyholder dies before policy maturation, the Sum assured as death benefit will be paid to the nominee, and the policy will be terminated.

If both partners die within the policy term, the Sum assured is paid to the nominee. Receiving a maturity benefit is subject to variation of the policy chosen. The additional benefits of terminal illness shall cover both partners.  

Joint life covers cannot be cancelled or discontinued once it is availed. However, if one has not taken a joint life cover, they can still avail of increasing Sum assured with the enhanced life protection. This provides an increase in life cover with major life milestones such as first marriage and birth of 1st and 2nd children. This cover cannot be added for joint policies.

The DigiShield plan offered by the company also provides similar benefits and cover for the policyholder and their spouse. The policy provides high coverage for flexible premium payment modes and affordable rates. The premium payment term can also be single pay, limited period, or regular pay, depending on the customer's convenience. The 50% of the Sum assured is paid out as a death benefit in case of a spouse's death during the policy term. However, it is only available when the primary Sum is assured if Rs 60 lakh or greater.  The option for joint cover can be chosen at inception, and this is not reversible.

The policy also offers an increase in cover with major life milestones such as first marriage and childbirth (first and second child). The death benefit can be paid in level term assurance and increasing term assurance, depending on the option selected by the policyholder. For increasing term assurance, the Sum assured increases by 5% or 10% per annum. However, if one opts for the joint cover option, no other rider can be availed of. Additional maturity benefits are also not available for the policy.

Aegon iSpouse Insurance Plan

The policy provides financial cover for the primary policyholder and their spouse. It is a traditional Joint life term policy that gives dual benefits. The policy can be bought online without much hassle. The death benefits can be paid out as a lump sum amount immediately on any one of the partners' death or be paid as monthly income for the subsequent five years. The policy also has in-built benefits for terminal illness and accidental death cover.

The policyholder can choose the plan tenure, and the Sum assured. The death benefit is paid in the case of a spouse's death during the policy term. For lump-sum payout, the entire Sum assured is given. For a monthly income option, 1.75% of the Sum assured is additionally paid each month. For a spouse's death due to accidents or terminal illness, an additional 50% and 25% of the Sum assured, respectively, is paid along with death benefits. There are no maturity benefits since it is a term plan. Tax benefits can be availed of in accordance with existing tax laws.

Bajaj Allianz iSecure Insurance Plan

It is a level term plan for low cost, and high Sum assured. Joint life cover can be included subsequently. On joining a partner, the Sum assured is paid on the death of one partner during the policy term. Further, if the other partner also dies during the policy term, an additional Sum assured is paid to the nominee. The policy is terminated on the death of both partners.

Other plans, such as Bajaj Allianz iSecure more, also provide Joint cover for a spouse. This plan also offers discounts on the premium on opting for joint life coverage. The death benefits are payable for the death of both partners during the policy term. After one spouse's death, the surviving spouse can continue the policy at a reduced premium based on age, lifestyle category, and policy term and premium payment frequency.

The additional rider benefits like Accidental death rider, accidental permanent total/partial disability rider, and waiver of premium benefit rider can be opted individually or jointly by both partners. Therefore in case of one partner's death due to an accident, the death benefit along with the Sum assured shall be payable while the rider continues for the surviving partner. The process works similarly for other riders as well.

If one is already married at the time of joining the policy, they cannot add their spouse later than the time of inception. However, if they are unmarried at the time of entering the policy, they can add their spouse at a later date. The policy does not offer maturity benefits and surrender benefits.

Canara HSBC OBC Term insurance Plan

The Canara HSBC OBC iSelect Star Term Plan is a pure protection term plan that offers additional cover for spouses along with other riders like accidental death/disability coverage. The option can be chosen from 3 variations – life cover, Life with the return of premium and Life Plus option. The plan does offer a maturity benefit for certain options. There are rebates on premium for higher Sum assured, and loyal customers.

The spouse coverage, which is up to Rs 25 Lakh, is also an optional feature under the iSelect term plan. There is also a terminal illness cover for the spouse. The plan has three variations- Life, Life with a return of Premium, and Life plus. Among this, the Life option applies to the insured's spouse as well. The benefit payout can be in a lump sum, monthly income mode, partly lump sum, and partly monthly income. In addition to this, they also allow an increase of Sum Assured with life milestones such as marriage, childbirth, and home purchase. There is also an alternate decrease coverage option. The policy comes with additional benefits for accidental death, accidental total and permanent disability, and child support services.

Further, on choosing a plan, there are different options for working and non-working spouses. For a non-working spouse, the Sum assured is fixed at Rs 25 Lakh, and additional covers or in-built covers are not applicable. While in the case of a working spouse, the cover options can be selected by the working spouse, and there are options for in-built cover and benefits for payout. This categorization of working and non-working spouses will be based on the company's BAUP.

Edelweiss Tokio Zindagi+

It is a term plan with options of "Better Half Benefit," which ensures enhanced life cover even in the absence of the primary breadwinner. Other options are life stage benefit and waiver of premium.

According to the Better half Benefit, on the death of a primary insured spouse, before policy maturing, 50% of the Sum assured or Rs 1 Crore, whichever is lower, will be paid to the surviving spouse. Further premiums need not be paid. The subsequent demise of the spouse will lead to the claim amount being paid to the nominees. After the death of the primary insured spouse, the surviving spouse becomes the policyholder, and they are required to submit a fresh nomination.

However, the benefit does not apply to a case where both spouses face death simultaneously or due to directly or indirectly related incidents. The suicide of the spouse within 12 months of the death of the primary insured spouse will also not receive the benefits.

These benefits are available for a variety of plans, such as the Edelweiss Tokio Life Active Income Plan. Edelweiss Tokio Life Simply Protect Plan, Edelweiss Tokio Life Wealth secure, and Edelweiss Tokio Life GCAP Endowment plan. These plans provide a high life cover for the affordably low premium amount. The life cover term can also be customized to ensure your family's financial stability, even in your absence. The life coverage can also be increased further with top-up benefits.

The Edelweiss Tokio Life Wealth Secure plan also covers child care and joint life cover for a spouse. On the death of either partner, the death benefit will be paid out. Subsequently, the life cover of the surviving partner will also cease and terminate. This also applies to reduced paid-up policies. Other benefits are also available for the policy, such as maturity benefits, loyalty additions, and booster addition.

HDFC Life Insurances

The company offers term plans and annuity plans that offer comprehensive cover for one's family's financial security after their demise. The HDFC Life New Immediate Annuity plan offers guaranteed income after one's retirement for their remaining life. This policy covers their spouse as well. The policy comes with flexible options for an annuity, such as monthly, quarterly, half-yearly, and yearly. It is a non-linked traditional annuity plan. A higher investment of Rs 2.5 Lakh may provide increased benefit from higher annuity rates as per the plan.

Apart from this, the HDFC Life Click2Protect 3D Plus offers additional covers to increase insurance on marriage and other life milestones like childbirth. The Sum assured can be increased by 50% on the first marriage. Further, for the birth of the first two children, the Sum assured can be increased by 25% each. There are nine various options for this policy, such as Life option, income option, and Lifelong protection option. The benefit may be paid as a lump sum amount or as a monthly income based on these options.

PNB Metlife Mera Term Plan

It is a pure protection plan offering four options. With joint life cover, there is an option to enhance cover sum at different life stages.

It is a comprehensive plan with provision for additional riders for critical illness, disability, and terminal illness. Further, an insurer can also opt for maturity benefits, which can be received if both partners survive the policy maturity term. The policy caps 50% of the Sum assured. In case of the death of the primary policyholder, future policy premiums will be waived. The surviving spouse would receive half of the Sum assured, and the remaining would be paid to the nominee in the case of the death of the other spouse within the policy term.

The life stage benefit helps the insurer increase the Sum assured during various life stages such as first marriage, the birth of 1st and 2nd child, and on a home loan. According to this benefit, 50% of the original cover can be increased in marriage. Subsequently, 25% each can be increased with the birth of the first and second child.  

The policy comes in four variations based on the payout of benefits. The benefit amount can either be paid as a lump sum amount as per the first option or be split into installments. For the remaining option, 50% of the Sum assured can be paid as a lump sum while the remaining is provided as a monthly installment for the next ten years. Another variation allows 50% sum assured as a lump sum, and the remaining is paid through monthly installments, which also include 12% interest. The fourth option is suitable for minor nominees. In this, 50% of Sum assured is paid in a lump sum, and the remaining is monthly installments until the nominee turns 21.

SBI Life –Smart Humsafar

It is an endowment Joint Life Insurance plan with options for additional riders. Premium is waived on the demise of any of the joint holders of the policy. The maturity benefit in case both the holders survive the policy term comprises the total of the base sum assured, vested reversionary, and terminal bonus.

In case of the death benefit, if a spouse dies within the policy period, the higher amount from either Sum assured on death or 105% of total premium paid shall be paid to the surviving spouse.

If the other spouse also dies within the policy period, a higher amount among 105% of total premium paid or Sum assured+ Reversionary bonus + terminal bonus would be paid to the nominee.

There are also options for including additional riders, such as the accidental death rider. It covers situations where both spouses die simultaneously in an accident or die on different dates but as a result of the same accident or due to different accidents within the same policy year.

Comparison of Joint Life Insurance Plans

The comparison is confined to only basic parameters. It is for the applicant to check up the individual plan brochure for greater insight into them.

Comparison of Joint Life Insurance Plans:

Insurance Plan

Entry Age

Maturity Age

Policy Term

Sum assured

ABSLI LifeShield Plan

18 - 65 years

80 years

50 years max

Rs 25 Lakh- unlimited

Bajaj Allianz iSecure Insurance Plan

18 - 60 years

28 - 70 years

10 - 30 years

Rs 2.5 Lakh-Rs 20 Lakh

Bajaj Allianz iSecure More

18-60 years

28-70 years

10-25 years

Rs 2.5 lakhs- no upper limit.

Canara HSBC OBC iSelect Star term Plan

18-(Depending on selected option and working or non-working spouse)

80 (Varies with options)

5-62 years (varies with selected options)

Rs 25 Lakhs to Rs 3 Crore (varies with selected options and a spouse working or not)

Canara HSBC OBC Smart iSelect Term Plan

18-65 years

28-80 years

10-30 for most plans

5-99 minus age at entry for whole life cover

Rs 25 Lakh- no upper limit

Accident Plus- Rs 3 Crore

Disability Plus- Rs 1 Crore

Edelweiss Tokio Zindagi+

18 - 65 years

80 years

62 years

10 X AP

HDFC Life Click2Protect 3D Plus

18- 65 years

85- Whole life cover depending on options

85 years- whole life depending on options

Rs 10,000- no upper limit

HDFC Life New Immediate Annuity Plan

30-85 years

-

-

Rs 10,000 annually- no upper limit

PNB Metlife Mera Term Plan

18 - 65 years

99 years

10 - 81 years

Rs 10 Lakh- Rs 5 Crore

SBI Life Smart Humsafar

18 - 46 years

65 years

10 - 30 years

Rs 1 Lakh - Rs 5 Lakh

How to Apply for the Best Joint Life Insurance Plan?

There are primarily two modes to apply for Joint Life Insurance. They are Offline and Online broadly.  In the offline mode, the assistance of intermediaries is called for. The process is manual right from initiation, completion of the proposal form to payment of premium through cash, cheque, or DD.

In the Online mode, the option in the portal asks for necessary details like age, gender, smoking habit, sum assured, policy term, premium payment frequency for the chosen plan. The premium is calculated and communicated. Once the quote is accepted, the premium is paid digitally. Finally, the proposal form is completed, and the application is processed. The standard set of required documents for application is as follows:

  • Photo identity proof
  • Age proof
  • Address proof
  • Income proof

Key Features and Core Benefits of Joint Life Insurance Plans

Joint life insurance policies come with a whole set of salient features and core benefits to offer. Here is a rundown to the key features and benefits of joint life insurance plans:

Some joint life insurance plans pay-out on the basis of the first claim, that means, the insurance company pays the sum assured on the demise of either of the two policyholders (whoever dies first) and the policy ends subsequently. Nevertheless, in the case of other joint life plans, the insurance company pays on the demise of each of the two policyholders, respectively.

Some joint life plans also offer critical illness rider to the basic plan. More to the point, the premium paid along with the received benefits under these plans qualifies for tax benefits under section 80C and 10(10D) of the Income Tax Act, 1961, respectively.

Things to consider while buying a Joint Life Insurance Plan

Sharing a life risk cover through Joint Life Insurance is a good option for married couples. While buying a suitable plan for meeting the joint needs, it is prudent to consider the following:

Working Couple:

Where both are working, it is sensible to buy a Joint Term Plan with sum assured is 10 times the joint annual income.  

Whole Life cover:

It is ideal to opt for a long policy term, preferably whole life.

Future Needs:

It is imperative to factor in future requirements, like education of children, purchase of a house, children's marriage, etc.  

Health Concerns:

It is of utmost importance, as with growing age, this will surely impact the finances of the family.

Choose Adequate Cover:

Considering all the above, the sum assured should be able to absorb not only the emotional shock but also sustain a comfortable lifestyle.

Premium Affordability:

Judicious evaluation of the income profile of the married couple helps in servicing the Joint Life Insurance until the policy paying term comfortably.

 

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