What is Survivor Life Insurance?

Survivor life insurance, also known as Joint Life Insurance or Last Survivor Life Insurance, is a type of whole life or universal life insurance policy usually purchased by married couples. The death benefit of a survivor life insurance policy is not paid until both insured persons have died. So simply put, the policy actually insures the lives of two persons.

When Survivor Life Insurance Is a Good Idea

 Survivor life insurance policies are usually purchased to help pay for estate taxes after both persons have died. This can help to preserve wealth or assets intended to be left to children or other heirs by using the proceeds from the life insurance policy to pay for estate taxes instead of having to sale assets or forfeit other forms of wealth in order to satisfy estate tax requirements.

Many people that purchase the types of policies bequeath them to third party trusts so that proceeds from the survivor life insurance are not subject to any estate taxes. This is especially helpful when the married couple is leaving behind a special needs child that needs adequate security for a lifetime. This type of policy is usually used in conjunction with separate single life insurance policies to provide additional financial protection for the special needs child.


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