Life Insurance for Couples

If you and your spouse rely on two incomes or are on the hook for joint debts, both of you may need life insurance.
Georgia Rose
By Georgia Rose 
Edited by Lisa Green

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When you're building your life with someone else, the foundation that the two of you are laying may need protecting, especially if you rely on each other financially. For couples, life insurance can help.

Why should couples get life insurance?

Here are some reasons to consider life insurance when you’re a couple.

Your expenses may increase as a couple

Couples often use their combined incomes to take on bigger financial obligations, such as renting a nicer apartment, buying a home or new cars and, possibly, having children. Many couples wouldn’t be able to bear these costs on just one income. One of the primary reasons for buying life insurance is income replacement, so that your family can continue its plans and lifestyle if a breadwinner were to die.

Your spouse may be responsible for your debts

Any debts left when you die would be paid out of your estate, meaning your assets. This repayment will eat into what you pass on to your spouse.

Your spouse could also be on the hook for co-signed loans or debts in any joint accounts. In community property states (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin), your spouse would be responsible for personal debts you took on after getting married, such as credit card balances. Life insurance for married couples can help cover those debts if one partner were to die.

Life insurance options for couples

Once you’ve decided to buy a policy, the question becomes what kind of coverage to buy and how much life insurance you need. Your decision generally depends on what financial obligations you want to cover, how long those obligations last and how much you want to spend.

Term life insurance

Term life insurance is suitable for many needs. It promises to pay a set amount if you die while the policy is in effect. You decide how much the payout would be and how long the life insurance should last. You can match the length of the policy to a financial need. For example, if you want to make sure your income is replaced for 10 years if you die, you can buy a 10-year term life policy in an amount that would match the income. Term life is the most affordable life insurance option.

Permanent life insurance

Permanent life insurance lasts your entire life and builds cash value. It’s a good fit for people who want to provide money no matter when they die. A permanent policy, such as whole life insurance, can be used to cover things like funeral costs or to pass on an inheritance. Also, you may be able to take a loan against the cash value while you’re still alive.

Survivorship life insurance

There are also survivorship life policies, which are a type of joint life insurance. They cover two people under one policy and are typically cheaper than buying separate policies for each person. This type of joint coverage can be set up in one of two ways.

  • First-to-die life insurance: This pays out upon the death of the first person. After that, the policy ends; it does not then extend to the surviving partner. The survivor could use the money as income replacement, to pay off a mortgage balance or to cover other debts. Note that this type of life insurance may be hard to find because there are few sellers.

  • Second-to-die life insurance: This pays out when both partners have died. It’s generally used by wealthy couples who want to make sure heirs, such as adult children, have money to pay estate or inheritance taxes. Or it may be used to fund the care of a child living with a disability when both parents die.

Before you buy, shop around and get life insurance quotes from different providers. In general, term life insurance is sufficient for most families. Your personal life and financial situation may change over time, so having your own coverage is often the best choice.

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