But what do you do if you split up with your partner?

Life insurance can give you the precious peace of mind of knowing that any dependents will be financially secure in the event of your death. But if you are in a couple or partnership, should you opt for a ‘single’ or ‘joint’ policy?

If you are in a relationship it might seem obvious to take out a joint policy, but this is not necessarily the best option. See below for the pros and cons of single and joint policies.

A single policy or separate plans?

Before deciding whether a single or a joint policy is right for your situation, it’s important to understand the differences between these two kinds of plan.

If you opt for joint life cover, for example, then you and a partner will be protected by a single plan on the same terms and conditions. But if you take out two policies, these will be entirely separate. That means, if a claim is made on one, it will have no impact on the other.

Possible issues with joint cover

If you opt for a joint policy, it’s important to remember there will only be one pay-out.

So, if a married couple had a joint policy, and both died in a car accident, their dependents would only receive one lump sum payment from the policy. If, however, the same couple had taken out individual policies, each one would make a pay-out.

Another potential downside of a joint policy is if a relationship breaks down: you can’t simply ‘split’ the policy. That means if one ex-partner decides they don’t want to pay their share of the premium, the policy would probably cease unless the other partner took on the full burden of paying.

With life insurance policies, if premiums aren’t paid, then simply the policy terminates.

There could also be issues over who is entitled to any pay-out from a joint policy, particularly if one of the former partners remarries and has children with their new spouse.

Having separate policies avoids this sort of issue. If a relationship does end, each partner has their own cover and can protect their dependents as they choose.

Key points to be aware of on joint life insurance policies

• The advantages of joint life cover are that it pays out regardless of which partner dies, and is cheaper than taking out two individual life insurance policies.
• It may be good for young couples who are trying to save money on premiums, or for business partners.
• Joint cover offers extra protection over taking out just one individual policy for the main breadwinner.
  Even where one person may stay at home to look after the kids, it’s usually worth having some cover for them as if they were to die, childcare costs could be a significant burden.
• Where the salaries of each partner in the home are vastly different, it may be worth taking out two individual policies – one each. These can be tailored to provide adequate cover for each person.
• Taking out two individual policies of the same amount will cost more than the equivalent joint policy, but provides double the cover.
• Although two separate policies will provide you with greater cover overall, if premiums aren’t affordable, having a joint policy is much better than not having life insurance at all.

Speak to one of our advisers on 01908 523 420 or email info@95.154.196.167. Because we are independent, we have access to the whole market, we advise on your individual circumstances to find you the most competitive deal possible.