Second to die life insurance, survivor ship life insurance, and or 2nd to die as some people refer to it is a specialized policy unlike typical individual coverage. When you’re looking to buy life insurance, there are several different kinds. Each type has different advantages and disadvantages that you have to weigh to see which one fits your needs the best. One of the common types of life insurance is Second to Die.
Second to Die Life Insurance, also known as “Survivorship Insurance” or “Dual-Life Insurance”, provides benefits to your heirs after the death of the last surviving (or second) spouse. Second to Die Life insurance allows parents to focus specifically on their children and often is used for estate planning, supporting the surviving children, or even for charitable bequests. But there are other reasons to own second to die life insurance. If you have questions about a no exam life insurance policy or insurance with companies life Banner Life or State Farm we have answers.
Who Buys Second to Die Life Insurance
Most of the time Second to Die Life Insurance is purchased by couples that may have large estate tax problems on the horizon due to their much larger than average estates. Since these policies are often much less expensive than an individual life insurance policy, it’s a very wise investment in order to receive a tax-free death benefit. A simple rule of thumb is that if the couple’s estate is worth $5 million or more, then it makes sense to purchase a Second to Die Life Insurance policy.
The Second to Die Life insurance policy isn’t exclusively for husband and wife. It can be purchased to cover two siblings, a parent and child, or even a pair of business partners. The Second to Die option is most commonly sold as a Universal Life insurance policy, but there are also a few carriers that offer a term life insurance policy with this option. (link to any carriers?)
Advantages of Second to Die Life Insurance
Underwriting is in your favor – The mortality table used by the underwriters for this policy is more lenient, since the policy will be based on two lives, not just one. As long as one person is in good health, even if the other is typically not insurable, you can often still get a policy.
Much lower premiums – Rates are often lower than for an equivalent life insurance policy for two people. The policy doesn’t build cash value and also doesn’t pay the benefit until both insureds die.
ROI – A greater return on investment is possible when a universal life policy with a Second to Die option could pay the death benefit well before the policy has been paid off in full.
Inheritance for Smaller Estates – The Second to Die life insurance policy affords a couple on the more modest side of the income spectrum the chance to still leave money for their children. Everyone wants to be able to pass along some type of inheritance, and a Second to Die life insurance policy is a great way to do that.
Why You Need Life Insurance
Second to Die life insurance is just one of the many different options that you have available for life insurance coverage, while you have to weigh the advantages of each type, it’s important that you have the coverage that you and your family deserve.
If both your and your spouse were to pass away unexpectedly, how much debt would you leave to your children and your loved ones? If you’re like the majority of people, you would leave behind mortgage payments, credit card bills, and much more. All of those debts can quickly add up to a massive inheritance of debt, which is no the legacy that you want to leave behind. Life insurance is a great way to ensure that this doesn’t happen.
When you’re shopping for a life insurance plan, once you decide what type of plan you want, it’s important to purchase a plan that is large enough to give your family enough coverage. Before you purchase a life insurance policy, sit down and add up all of the unpaid expenses that you would leave to your children. Make sure that whatever policy you purchase is large enough to pay for all of those debts, don’t forget to calculate any taxes that would be taken out.
The other factor that you need to calculate when you’re looking for a policy is annual income and financial loss that your children or loved ones would suffer if you and the other policyholder were to pass away. Aside from paying off debts, the other goal of life insurance is to give you loved ones enough time to find a way to replace your income. While it’s not fun, take the time to imagine if you and your spouse were to pass away, do your children rely on your income? How much money would they need?
Not having life insurance is one of the worst mistakes that you can make for you and your family. Every year there are thousands of families that lose a loved ones, and on top of the emotional stress, they find themselves with piles and piles of debt that they don’t have the money to cover. Don’t let your children or loved ones end up like one of these stories. Having life insurance gives you peace of mind knowing your loved ones will be taken care of if anything tragic were to happen.
It’s important t hat you find the perfect policy to fit you and your family’s needs. We can help you get the best policy at affordable rates. One of the best ways to get the lowest rates is to shop around with different companies before you choose one. You could spend hours on the phone or on the Internet researching different companies, or you can let us bring all of the rates to you. We will ensure that you find the type of policy to fit your needs at a price that you can afford.
Contact me at 877-400-0484 to discuss whether the Second to Die Life Insurance policy is a fit for your estate planning needs.