Life insurance help from Tiscali

When it comes to buying life insurance, opting to buy two single policies instead of a joint life policy for you and your partner will double your overall protection.

With double the protection, the policy will pay out twice if a claim needs to be made on both lives, where as a joint life insurance policy will only ever pay out once. From a cost perspective there is very little difference - the extra you pay is almost certainly outweighed by the benefits it adds to your family's overall protection.

The figures

A review of UK Life Insurance rates shows that a non smoking couple, each aged 35, would pay a standard premium of £27.26 for a joint policy that paid out £200,000, should either of them die during a 25 year policy term.

As an alternative they could each take out £200,000 of life cover over the 25 year term for a combined premium of £29.19. (Source- The Exchange 26th April 2007).

The additional premium of £1.93 now provides a total potential payout of £400,000 should both policyholder die. Under the joint option the plan only pays out on first death.

The benefits...

If you have children or other dependants, individual cover will provide you with more financial protection. For example, the first claim could be used to pay off your mortgage and the second claim could perhaps provide financial security to protect your children's future.

As well as the increased protection there are other benefits of buying individual policies.

As we know, marriages and relationships do not all end 'happily ever after'. In the event of separation, couples who have a joint life insurance policy would have to change or cancel their policy and arrange new cover. Single life insurance polices are more flexible since each partner can take their individual cover with them.

Another plus point of a single policy is you can update the policy details such as increasing the amount of cover if you have more children or change the beneficiary without any complication.

You are also guaranteeing that in the event of making a claim, the remaining partner still has their own life cover.

Other tips to consider when buying life insurance...

There are additional benefits to be gained by writing the individual policies in trust. This can be arranged by your broker at the time of taking forward the cover and doesn't cost anything.