Life Insurance for Multiple Lives

We are not cats; we each just have one life. However, you can get life insurance coverage for the multiple lives of multiple people from the same family with a single insurance policy.


Saving Money with One Policy

If you are looking to get life insurance coverage for more than one family member (e.g. both parents, parent and a child), you can save money by taking out just a single life insurance policy.


How does this work? You complete one application but include multiple members from the same family. Each of you goes through the questionnaires and tests required. You can get coverage for both parents at the same time, or get coverage for parent(s) and child(ren).


The savings will come either through multi-product discounts or through the insurance company only charging one policy fee even though multiple individuals are covered. A typical policy fee can be up to $5 a month, which you can cut out of the overall cost.


3 Methods to Cover Family Members

To cover more than one family member, you can choose:

  • joint first-to-die
  • joint last-to-die
  • multi-life coverage

However, in nearly all cases, we only recommend multi-life coverage.


Joint First-to-Die

A harsh sounding name, we know. Joint first-to-die insurance covers a couple and pays out only once, upon the first death.


As an example, a couple could get $500,000 of joint first-to-die insurance. When the first of them dies, the other, or whoever was beneficiary, receives $500,000. The insurance ends at this point. Potentially years later, when the second dies, there is no insurance payout.


With only one payout, it would make sense for this insurance to be cheaper than the couple each having a policy. In reality, there is hardly a cost saving. What happens is the couple’s ages and health are blended together to come up with an older age that represents an equivalent risk of death.


Say a couple who was each 40 years old applied. The insurer may decide they are equivalent to one 55 year old, in terms of likelihood of death. Their insurance policy would cost whatever it costs for 55 year old’s. Plus, instead of two $250,000 policies, they would apply for one $500,000 to get the same total payout. The cost savings are typically only a few dollars.


On the other hand, the couple only has one coverage. Unfortunately relationships change, even after years of marriage. After a divorce, a couple would have no way of splitting the coverage for both partners. They would have to reapply for coverage, using their current age and health.


We don’t recommend this coverage, except in cases where one partner may have trouble getting coverage due to health history or life situation.


Joint Last-to-Die

The next type pays out not when the first partner dies, but only after the second partner passes away. What is the use of this? There are situations where a cost arises only after the last spouse dies.


For example, say a couple owns a lake cottage as a second home. The cottage may have increased tremendously in value over the years. If one of them dies, the other receives full ownership tax-free. But when the remaining partner dies, the cottage will have taxes owing as it’s not the primary residence. Unlike transfer between spouses, a parent cannot pass on ownership tax-free to a child.


So for many, families may choose to buy whole life insurance in a joint last-to-die policy to protect property in the family.


Another use of a last-to-die policy will be to establish an inheritance or legacy gift. The couple may decide that after they both pass to give their assets to their children or to a cause they believe in. A whole life policy can be a way to efficiently do this.


With these examples, the need for the insurance occurs precisely after the second partner passes away. Individual insurance on each of them would not make sense. With this kind of need, it is best to have joint last-to-die insurance.


Multi-Life Coverage

The final type is simply individual insurance on multiple lives, rolled into one insurance policy. If multiple family members (e.g. husband and wife) both want to get coverage at the same time, say due to the birth of a child, this is typically the best option because of cost savings. 


A couple can get flexible, individual coverage on themselves based on their needs, but because they take out just one policy, they’ll save a few dollars a month.


If one partner dies, the beneficiaries receive the benefit, and the policy continues to exist to cover the other partner.


Or, if down the road the couple wants to separate the policies, they can do this with a simple form. No new applications or underwriting are required. We’ve seen this happen because of marriage breakdowns. We’ve also seen it when a parent and child both have coverage through one policy, but the child becomes an adult and wants to own their own policy.


Hoping to Get Multi-Life Coverage?

We do not provide quotes for multi-life insurance online. But we will still get you the lowest combined rate.


If you are looking to get coverage for both partners, each complete your own Insurance Checkup and select a quote from the drop-down. When booking your time, just have one of you pick a time, and select the booking option for multiple family members.


We will match up your individual quotes, and compare which insurer will give you the same insurance coverage for the best price in a multi-life policy. And then we’ll complete just a single application with the two of you. It’s simple, and we’ll save you money every month!



Do you have any more questions about multi-life policies or when joint coverage may be appropriate? Shoot us an email.




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