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Joint Term Plans v/s Two Individual Term Plans

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Term insurance is a fairly common concept that many people are aware of. However, not many people are aware of joint term life insurance, which is a relatively new insurance product to be introduced in the market. Term plans are one of the most common types of life insurance opted by millions of people around the world, owing to its attractive benefits. Once can get a high amount of sum assured as cover at very nominal or reasonable premiums for a fixed time period of 5 to 30 years. Since they offer the simplest form of risk protection, against the risk of death, they are also known as pure risk protection plans.

What is Joint-life Term Insurance?

The concept of joint term insurance is a recent one which started becoming popular after more and more women began to join the workforce and contribute to the household’s income. This has given rise to the need for both partners to be insured, and that is exactly what a joint term insurance plan does. As the name suggests, this is also a term insurance plan with the only difference being that both partners are covered under a single policy. If either of the partners covered under the policy dies suddenly before the end of the policy term due to a cause that is listed in the policy, the surviving spouse is entitled to the death benefit sum assured.

How this plan works

The working of a joint life term policy is similar to that of a regular term insurance policy. The only major point of difference between these two policies is that while a term plan will cover a single individual, a joint term insurance plan covers two individuals under the same plan. Besides that, most other aspects are same as a term plan i.e. coverage tenure is fixed, premium payment for both partners is combined, and premiums are paid on a regular basis. If either of the insured individuals dies before the policy term ends, the surviving partner gets the death benefit payout.

Claim payout options

In terms of claim payout, joint term plans usually offer multiple options. These include: (i) If either of the policyholders passes away, the surviving policyholder gets the sum assured as death benefit in a lump sum after which the policy ends;

(ii) After the death of one policyholder, the sum assured is paid to the surviving policyholder and the policy continues to provide cover till the end of its term, or till surviving policyholder dies, whichever takes place sooner. Under this option, the future policy premiums may or may not be waived after one policyholder’s death;

(iii) After the death of one policyholder, the sum assured is provided to the surviving policyholder as death benefit in a combination of lump sum and regular payouts for a fixed duration in the future.

Benefits of Joint Life Term Insurance

  • Save money on premiums

Even though term insurance is known to be available at very affordable and low premiums, the premium outgo for two individual term plans will still be higher in comparison to that of a joint term plan. This is the reason why joint term plans are a wiser option for couples who are looking to get covered under a term plan and save on premiums at the same time.

  • Multiple claim payout options

When it comes to claiming payout, joint term plans have a number of options that policyholders can choose from. Just like no two individuals will have the same requirement, the same way, the same payout options may not be suited for everyone. For greater customisation, joint term plans will usually give policyholders the flexibility to choose from an option that closely first their requirements.

  • Tax savings –

Similar to other types of life insurance, joint life term insurance plans also come with tax benefits which policyholders can avail. The premiums paid towards the plan are eligible for tax deduction, as are the benefits which the plan provides, under the provisions of the Income Tax Act, 1961.

  • Riders available –

Like any other type of life insurance plan, joint term plans are also available with riders, which can be purchased over the plan, to enhance its coverage. The accidental death benefit rider (cover against the risk of death caused due to an accident) and terminal illness benefit (if insured is diagnosed with a critical illness, the rider benefit is payable) are two of the most commonly available riders that you can opt for with a joint term plan. The rider premium is over and above the premium charged for the base plan.

  • Easy maintenance –

Timely premium payment is crucial to ensure that you are never left without insurance coverage. However, doing that may sometimes be a tad challenging. However, with a joint term plan, that is no longer a worry as there is only one policy for which premiums have to be paid, instead of two. Also, since both policyholders are given access to the policy account, either one can make the premium payment, in case the other one may have missed doing so.

Joint term insurance or Individual term insurance: Which should you go for?

  Joint Term Plan Individual Term Plan
Coverage A single plan will cover both partners for a fixed period of time A single term plan can only be taken by a single individual. It does not cover more than one person
Sum Assured
  • Sum assured is combined for both policyholders
  • Amount of sum assured will depend on the annual income of each policyholder
  • Terms of coverage will be the same for both policyholders
The sum insured is set based on the policyholder’s yearly income
Premium Premium payment is combined for both policyholders. There is no arrangement to pay premium individually for each policyholder Policyholder pays premiums in exchange for coverage
Who is it fit for
  • For couples with little difference in age
  • For mid-aged partners who wish to save on life insurance premiums
  • Couples where both partners have similar lifestyles and lifestyle habits – teetotallers, non-smokers, etc.
Term plans are ideal for anyone who is looking to get affordable coverage for their dependents. Ideal candidates would be young parents, newly married couples, young people supporting dependents like siblings, or aged parents, etc.
If one insured policyholder dies The sum assured death benefit will be paid to the surviving partner. Policy continuance and waiver of future premiums will depend on the claim payout option that the policyholders have opted for Since there is only a single policyholder, in this case, the sum assured will be given to their beneficiary, after which the policy will cease to provide cover. Since the remaining partner is covered under a separate term plan, they will continue receiving cover.
If both policyholders die In case of death of both policyholders, the legal heir named in the policy will be entitled to the sum assured death benefit according to the claim payout option chosen In the unlikely event that (i) both partners die, and (ii) the spouse has been named as the nominee in each of the two policies, then the sum assured from each policy will go to the legal heir as per the policy document
If both policyholders are divorcing If permitted by the company, the policy may be split. Contact your insurer to explore this option Since both partners have individual policies, they may only have to change the nominee details, if required

Joint Term Plans v/s Two Individual Term Plans Reviews

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  • Bajaj Allianz Life Life Insurance
    "Safe plan for future"
    0.5 5.0/5 "Blown Away!"
    I have life insurance with Bajaj Allianz, I used to pay Rs. 12,000 for one year policy, it has the tenure of 40 years, Its a totally term plan for the value of 1 crore, they give lump sump amount to the nominees, the claim ratio is good and also terminal waiver on premium.
    Was this review helpful? 0
    , pune
    Reviewed on Dec 14, 2018
  • SBI Life Life Insurance
    "Best ULIP Policy"
    0.5 5.0/5 "Blown Away!"
    I have purchased a market based policy 2 years ago. I have chosen SBI LIFE because it was suggested by my friend. I pay the premium amount of Rs. 10000. I make the premium through online. The growth was pretty good and tenure period of the policy is 10 years.
    Was this review helpful? 0
    , bangalore
    Reviewed on Dec 14, 2018
  • LIC Life Insurance
    "Best policy in LIC"
    0.5 5.0/5 "Blown Away!"
    My money back policy was taken with LIFE INSURANCE OF INDIA. I pay the premium amount of Rs. 5000 in a month. I have selected LIC because of the returns. I make the premium through ECS. Total tenure period of the policy is 25 years. My friend has referred me about this policy
    Was this review helpful? 0
    , bangalore
    Reviewed on Dec 14, 2018
  • LIC Life Insurance
    "Good LIC policy"
    0.5 5.0/5 "Blown Away!"
    I'm just paying the premium and i have never get the sum assured amount and i will get it after 25 years of tenure period. I'm making the premium through ECS. I pay the premium amount of Rs. 5000 every month. I will get a coverage value of Rs. 1.27 Cr.
    Was this review helpful? 0
    , bangalore
    Reviewed on Dec 14, 2018
  • Bharti Axa Life Life Insurance
    "Best Policy"
    0.5 5.0/5 "Blown Away!"
    I have taken life insurance from the Bharti Axa life as it has good returns i make the payment through on-line banking annually . This policy covers accidental and critical illness benefits with the tenure period of 15 years . Overall am satisfied with my policy .
    Was this review helpful? 0
    , faridabad
    Reviewed on Dec 14, 2018
  • LIC Life Insurance
    "Useful policy"
    0.5 4.0/5 "Great!"
    In the month of February, i have purchased a money back policy from Life Insurance corporation of India. I pay the premium amount of Rs. 15000. Last time i have paid the payment through cheque and in future i make through online. One of sister who is working as a LIC agent has referred this policy.
    Was this review helpful? 0
    , bangalore
    Reviewed on Dec 14, 2018
  • LIC Life Insurance
    "Useful policy"
    0.5 4.0/5 "Great!"
    I have purchased a term insurance policy 1.5 years back. There is no particular reason for choosing the LIC. I pay the premium amount of Rs. 26000 and i have chosen the annual payment mode. Sum assured amount was Rs. 70 lakhs. Total tenure period of the policy upto 70 years of my age.
    Was this review helpful? 0
    , bangalore
    Reviewed on Dec 14, 2018
  • LIC Life Insurance
    "Average Policy"
    0.5 3.0/5 "Satisfactory"
    I have a life insurance policy with LIC from last 4 years and it is a long term policy. I pay my premium once in 6 months through direct payment and i am convenient with the payment options. Tenure period for this policy is 18-20 years. The returns and benefits are good in this policy.
    Was this review helpful? 0
    , ghaziabad
    Reviewed on Dec 14, 2018
  • LIC Life Insurance
    "GOOD SERVICE"
    0.5 5.0/5 "Blown Away!"
    I have purchased the life insurance policy with the LIFE INSURANCE CORPORATION OF INDIA where the name of the policy is ENDOWMENT PLAN and i am using it from past 10 years. The maturity period of this policy is till 67 years of my age. This gives the policy coverage of 4 lakhs.
    Was this review helpful? 0
    , bangalore
    Reviewed on Dec 14, 2018
  • LIC Life Insurance
    "Good Policy with Life Coverage"
    0.5 5.0/5 "Blown Away!"
    I have agent who coordinate with me for my life insurance, they are responding well, the customer support is good, they have different payment options. The policy name called Jeevan labh its for 15 years I get the benefits as lump sum amount with life cover.
    Was this review helpful? 0
    , bangalore
    Reviewed on Dec 13, 2018
  • LIC Life Insurance
    "Good service"
    0.5 4.0/5 "Great!"
    I have been using my life insurance with Life insurance corporation of India,the agent had clearly explain me about the policy coverage, plan benefits etc, there premium amount they have charged me was nominal,they charged in quarterly basis,overall service is good.
    Was this review helpful? 0
    , hyderabad
    Reviewed on Dec 13, 2018
  • HDFC Life Life Insurance
    "Fine policy for emergency purpose"
    0.5 5.0/5 "Blown Away!"
    Along with my personal loan they have provided me a life insurance policy from HDFC LIFE. I have to pay the premium amount of Rs. 6000 in a year. I used to pay the premium through online. Total tenure period of the policy is 4 years. I'm getting a sum assured amount of Rs. 3 lakhs.
    Was this review helpful? 0
    , gurgaon
    Reviewed on Dec 13, 2018
  • SBI Life Life Insurance
    "Best Policy"
    0.5 5.0/5 "Blown Away!"
    I took this Life insurance from Sbi life mainly because of the good returns. The payment am doing through online every year through online payments . The best about the policy is it covers accidental coverage and critical illness There customer service and customer response is also good.
    Was this review helpful? 0
    , bangalore
    Reviewed on Dec 13, 2018
  • LIC Life Insurance
    "Best Policy"
    0.5 5.0/5 "Blown Away!"
    Based on the benefits and returns i have chosen this life insurance corporation of India . I am satisfied with the amount which am making for the policy . Am making the payment yearly through online . This policy cover accidental benefits . Overall am happy with it.
    Was this review helpful? 0
    , faridabad
    Reviewed on Dec 13, 2018
  • LIC Life Insurance
    "Good policy"
    0.5 4.0/5 "Great!"
    I have purchased a life insurance policy in my wife's name. 5 years back i have bought the Jeevan saral policy with Life Insurance Corporation of India. Since its a better company, i have selected the LIC. I pay the premium amount of Rs. 5400. Its a long term policy. I have selected the annual payment mode.
    Was this review helpful? 0
    , mumbai
    Reviewed on Dec 13, 2018
  • LIC Life Insurance
    "Best Service"
    0.5 5.0/5 "Blown Away!"
    I am using LIC using thee policies same policies life insurance coverage and two more different policies i am never contact customer Service for everything contact with agent only Responsiveness very good , Promised Interest Rate is less in LIC but trust worthy , Fees & Charges is use to pay by agent only. Hence i can give rating 5 for best service
    Was this review helpful? 0
    , ahmedabad
    Reviewed on Dec 13, 2018
  • IDBI Federal Life Insurance
    "Very Good"
    0.5 4.5/5 "Excellent!"
    IDBI Life cover policy for my children there is more benefits in this policy i have to pay 30k every year after his age of 16 partially amount will received for his education after few years for marriage and in risk factor also amount will provide once terms will complete total Amount will be received in 3 terms for this policy.
    Was this review helpful? 0
    , hyderabad
    Reviewed on Dec 13, 2018
  • LIC Life Insurance
    "Very good"
    0.5 4.5/5 "Excellent!"
    I am using Life Insurance policy and need payment in six month once i am happy with LIC insurance policy . Since long time i am using Life cover policy so i am only trust to LIC for Life insurance payment is made in cheque and sometimes in cash which one collected by agent for service i can give rating 4.5 very good service.
    Was this review helpful? 0
    , hyderabad
    Reviewed on Dec 13, 2018
  • HDFC Life Life Insurance
    "Every salary holder must taken this policy"
    0.5 4.0/5 "Great!"
    I have purchased the HDFC accidental policy nearly 4 years before. I have been paying the premium amount of Rs. 80000. I used to make the premium through my credit card and i covert into EMI basis. This is annual payment mode policy. This policy has coverage value of Rs. 15 lakhs and all my member covered in this policy
    Was this review helpful? 0
    , kolkata
    Reviewed on Dec 13, 2018
  • LIC Life Insurance
    "Good policy in LIC"
    0.5 4.5/5 "Excellent!"
    Since its a Government undertaken i have selected Life Insurance corporation of India for my life insurance policy. One of my agent who referred me about the Jeevan Anand policy. I had purchased this policy in 2013. I used to make the premium amount of Rs. 30000 and i have selected the yearly payment mode. The policy will get over by 2033.
    Was this review helpful? 0
    , kolkata
    Reviewed on Dec 13, 2018
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