Survivorship Life Insurance

What Does Survivorship Life Insurance Mean?

Survivorship life insurance is a type of permanent life insurance that covers two individuals, typically a married couple, and provides a death benefit to beneficiaries only after both insured individuals have passed away. The coverage remains active as long as the policyholders continue paying premiums and at least one insured person is alive.

This type of insurance is also referred to as second-to-die insurance or dual-life insurance. Because survivorship policies fall under the broader category of permanent life insurance, they build cash value over time and last the lifetimes of both insureds rather than expiring after a set term.

Insuranceopedia Explains Survivorship Life Insurance

Survivorship life insurance is generally more affordable than permanent life insurance for an individual. Because it covers two people, the policy typically lasts longer, as the likelihood of both individuals passing away early is lower compared to just one. This extended duration allows the insurance company more time to collect premiums, enabling them to charge a lower annual cost.

Couples often choose survivorship life insurance for estate planning purposes, as it helps their heirs cover estate taxes and other settlement costs. By opting for this type of policy, couples can secure a larger death benefit for the same premium amount, providing their heirs with financial support for final expenses, inheritance taxes, and additional funds for future needs. Since most couples look at this coverage later in life, it’s worth reviewing rates from the best life insurance companies and comparing them against standard life insurance options for seniors over 70 before deciding if a second-to-die policy is the right fit.