Joint vs Single Term Insurance Plan – All you need to know


When you think of getting a term plan, you consider a lot of things – the premiums, the sum assured, the payment mode, and so on. However, one of the first things you think about is whether to get a joint term plan or a single one. So, let’s highlight some of the differences to help you figure out what to choose and why you should calculate term insurance premium.

Joint vs. single term insurance: Definition

Single term insurance:

It is the purest type of life insurance where the policyholder takes up an insurance policy for a certain ‘term’ or number of years. A term plan offers death benefits. It means the beneficiary receives the sum assured in case of the policyholder’s demise. The main draw for it is not just the financial security and death benefits but also that it offers higher coverage at a lower premium.

Joint term insurance:

Joint term insurance came into the scene after term insurance. It was mainly introduced as more women started joining the workforce. So, the idea was to make sure that both the working partners are equally insured. The basic features of a term plan remain the same. The only difference is that if one of the partners dies, then the other gets the death benefits. If both of them die, then their children or the chosen beneficiary gets the benefits.

Joint vs. Single term insurance: Premiums and Benefits

Single term insurance:

A great thing about getting term insurance separately is that the beneficiary can get two separate benefits. So, in a way, the policyholders can leave twice the benefits for their children. In a joint term plan, the beneficiary is entitled to receive a single death benefit.

Also, getting joint term insurance means that one partner will have to shoulder the entire premium payment if the other simply refuses to pay up. In case there is a divorce, the policyholders will have to go through hassles to make it a single term plan.

Joint term insurance:

A term plan is affordable by nature. Regardless of that, paying separate premiums for two different policies is costlier than paying one premium for a joint policy. So, joint term insurance can be the way to go if the search is on for something absolutely affordable.

Joint vs. Single Term Insurance: Suitability

Single term insurance:

  • It’s more suitable for younger individuals because the premium is going to be lower. So, it is advisable when an individual has just joined the workforce.
  • It is better suited for couples who have a major age gap as the premium payment is harder to assess as per the sum assured and age in the joint term policy.
  • If one partner is a smoker, then it is better to get single term insurance. The premium will differ when two partners get a term insurance plan, and one of them is a smoker.

Joint term insurance:

  • It is better for middle-aged couples because the premiums for separate policies would be more expensive.
  • It is suitable for couples without a major age gap between them.
  • If both the partners have similar lifestyle choices, then a joint term insurance plan is helpful. If one partner smokes, then it ultimately will lead to higher premium payment.

Now, as you can see, each has its own pros and cons. The choice depends on your financial situation and needs.

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