Life Insurance For Married Couples (2024)

You likely made vows when you got married, but did you promise to have adequate insurance? It may be time to say “I do” to reviewing your insurance needs as a couple.

Having the right types and amounts of insurance will help ensure that your finances are protected from lawsuits and accidents. Life insurance for married couples is particularly essential if you want to safeguard your spouse’s financial security if you pass away.

An Insurance Checklist For Married Couples

Why Do Married Couples Need Life Insurance?

Buying life insurance can prevent a surviving spouse from suffering financial hardship if their spouse passes away.

When you were single, you may not have had anyone counting on you for financial support. That may have changed now that you’re married. If you and your spouse count on each other’s income to support your lifestyle, you both need life insurance that will keep the other financially afloat if something happens.

A life insurance payout can be used for anything the beneficiary wants. It can pay for funeral costs, the rent or mortgage, household bills and debts. It also can be used to help pay for child care and, eventually, college for any children you might have. It can also leave a legacy for those you love.

Life Insurance Options for Couples

Supplemental Life Insurance and Spouse Life Insurance

Your employer might offer supplemental life insurance as an employee benefit. But the amount of coverage you get through a group insurance plan might not be enough. Also, you likely can’t keep that coverage if you leave the job. That’s why you should get an individual life insurance policy.

Your workplace may also offer supplemental spouse life insurance. This allows you to be named beneficiary of a life insurance policy you buy for a spouse or domestic partner at group rates. For example, you may be able to buy up to $100,000 in coverage for your spouse or partner, in $10,000 increments.

Joint vs. Separate Life Insurance

Joint Life Insurance Policies

Joint life insurance is a life insurance policy that covers two people instead of one, but it only pays a single death benefit when one of the two individuals passes away. There are two main types of joint life insurance:

• First-to-die joint life insurance: When one policyholder dies, the surviving policyholder receives the death benefit. The survivor will no longer have life insurance once they receive the payout. Some policies may allow you to convert to an individual policy with the same death benefit, but the new policy may have higher rates.
• Second-to-die joint life insurance: Also called survivorship life insurance, second-to-die life insurance pays a death benefit after the second surviving policyholder dies. The payout goes to the joint policyholders’ beneficiaries. That means neither policyholder gets a death benefit.

Separate Life Insurance Policies

Separate life insurance policies for a couple would insure each person on their own policy. A death benefit would be paid to the life insurance beneficiary—in this case your spouse— if the insured person dies, as long as the policy is in force.

There are two main types of life insurance: term and permanent. Term life insurance provides a fixed cost for a certain number of years, such as 10, 15, 20 or 30 years. When the term is over, you can usually renew the policy, but at much higher rates.

Permanent life insurance lasts for a lifetime and it’s more expensive than term life. Permanent life insurance policies include a cash value component, which accumulates on a tax-deferred basis. You can tap into the policy’s cash value while you’re alive.

A term life insurance policy can be ideal for a young couple because it’s affordable, says Sharif Muhammad, a licensed insurance agent, certified financial planner and owner of Unlimited Financial Services.

You’ll want to consider a term length and amount of coverage that can:

• Cover the years of a mortgage.
• Cover other specific debts, such as car loans or credit card bills.
• Cover the years until children graduate from college.
• Replace income during your peak working years.

If you’re buying term life insurance, look for a policy that offers the option to convert to permanent coverage “so you have the option if you want to maintain the policy after the term runs its course,” Muhammad says.

You can shop for life insurance policies online, including options for getting life insurance with no medical exam. However, consider working with an independent insurance agent who can help you determine how much life insurance you need and will shop around for you to find the best policy for your needs.

Which Type of Life Insurance Is Best for Married Couples?

Buying individual life insurance for each person can be more beneficial than buying a joint life insurance policy for a married couple. One key advantage of purchasing separate life insurance policies is that each person can find a policy that best suits their health conditions, age and gender.

Term life insurance may be the best type of life insurance for married couples. That’s because it’s generally the most affordable type of life insurance. But, permanent policies that include cash value, like universal life insurance, can be a good choice for married couples who want life insurance with a savings or investment component. The best type for you and your spouse depends on your age, health and financial goals.

Individual life insurance is probably a lot cheaper than you think. A Forbes Advisor survey found that 82% of Americans over the age of 25 estimate that the monthly cost of term life insurance costs at least three times as much as it does. Life insurance can cost less than $20 a month, depending on your age, gender and health.

For example, the average cost of life insurance for a 20-year, $250,000 term life insurance policy for a man is $13, or $159 yearly. The same policy for a woman of the same age costs $12 a month, or $142 annually, based on Forbes Advisor’s analysis. That means you can pay less than $25 per month for two separate term policies.

Which Type of Life Insurance Is Not Best for Married Couples?

Second-to-die life insurance is not a smart move for married couples who want a payout to go to their surviving spouses. Instead, second-to-die joint life insurance is usually used for estate planning. For example, adult children can use the death benefit to pay estate taxes once both parents have passed away.

How to Save Money on Life Insurance

Two of the best ways to save money on life insurance are to buy a policy when you’re young and to compare life insurance quotes.

Buy Life Insurance at a Young Age

Your age, health, policy type and amount of coverage you want are among the key factors that affect life insurance rates.

“The younger and healthier you are when you get coverage, the more affordable it is,” says Amy Shepard, a certified financial planner with Sensible Money. She suggests it can be worth it to pay a little more for a policy with a bigger benefit now in order to ensure the payout will be enough to cover any future expenses you might have, such as a house with a mortgage or children.

You could also buy more life insurance in future, but you’ll be paying rates based on your older age and any health problems that develop in the interim.

Compare Life Insurance Quotes

You can save thousands of dollars over the life of the policy if you compare life insurance quotes. Prices will vary from one company to the next. Consider working with an experienced agent who will know which companies are likely to offer you the best life insurance quotes based on your age and health.

Disability Insurance

Why You Need It

More than 1 in 4 of today’s 20-year-olds will become disabled before reaching age 67, according to the Social Security Administration. If you became part of that statistic and can’t work because of a disability, you and your spouse would likely feel the financial pinch from the loss of your income.

Workers’ compensation insurance will pay only if the injury or illness is work-related. It can be difficult to qualify for Social Security disability benefits, and the average payout is just $1,483 a month.

That’s why it’s important to have disability insurance to fill the gap. Think of it as protection for your paycheck because it will replace a percentage of your income if an illness or injury leaves you unable to work, temporarily or permanently.

Disability insurance can even be used to replace income during maternity leave, Shepard says.

How to Get Disability Insurance

If you’re employed, you likely can get disability coverage through a group plan at work. Typically, group disability coverage will replace up to 60% of income, Shepard says.

The drawback to relying on group coverage is that you can’t keep it if you leave your job.

“I think it’s always a great idea to take advantage of group coverage if you have it and supplement it with a private policy,” Shepard says. That way, you’ll still have coverage regardless of your employment situation.

If you already have group disability insurance, the amount of individual coverage you can get is limited. Shepard recommends working with an independent insurance agent to coordinate individual coverage with any group coverage you might have.

How to Save Money on Disability Insurance

Getting disability insurance through a group plan at work is usually the most affordable option—and the easiest. If your employer has a group disability insurance plan that is offered to all employees at no cost, you will automatically qualify for coverage without having to answer any questions about your health or having to take any medical tests, according to Life Happens.

Individual disability insurance can be more expensive. Because the cost is impacted by your age and health, you can save money by getting disability insurance while you’re young and healthy, Muhammad says.

You also can keep down the cost of disability insurance by opting for long-term coverage rather than short-term coverage, Shepard says. It’s more important to have a policy that will protect you for a significant period of time, and you can rely on an emergency fund (if you have one) to replace your income if you have a short-term disability.

Also, see if any professional organizations you might belong to offer a group policy for long-term disability insurance. As long as you maintain your membership, the group coverage will likely be more affordable than individual coverage.

Health Insurance for Married Couples

Coordinate Coverage With Your Spouse

You can typically make changes to your health insurance plan through work (for group coverage) or through the health insurance marketplace (for individual coverage) once a year during open enrollment. But marriage is one of the life events that allow you to make changes to your coverage outside of open enrollment.

If you or your spouse don’t already have health insurance, you may be able to get coverage now through one or the other’s plan. If you both have coverage, it’s a good time to review your plans to see if you should maintain separate policies or get joint coverage, says DeDe Jones, a certified financial planner and managing director of Innovative Financial.

You might find that, for example, that you can get better, more affordable coverage by switching to your spouse’s health insurance plan.

If you and your spouse do not get health insurance through your employer, you can buy private health insurance through the Affordable Care Act (ACA) marketplace or directly from a health insurance company.

How to Save on Health Insurance

A common way to lower the cost of health insurance is to opt for a plan with a high deductible. Premiums on high-deductible plans are lower because you have to pay more out of pocket until coverage kicks in. This type of plan can make sense for healthy, young adults who don’t take many or any prescription drugs and don’t require frequent trips to the doctor.

But you shouldn’t bet on your good health to help you avoid paying the deductible. If your employer offers a health savings account along with a high-deductible health plan, you should be setting aside money in that account to cover your deductible and other out-of-pocket medical costs.

If you can’t afford to max out your health savings account or cover the cost of your deductible, a high-deductible health insurance plan might not be the best way for you to save money on health insurance, Muhammad says.

If a high-deductible health insurance plan isn’t a good fit for you and your spouse and workplace health insurance isn’t an option, you may find the best affordable health insurance for your situation through the ACA marketplace, especially if you qualify for subsidies.

Auto Insurance for Married Couples

Alert Your Car Insurance Company About Your New Status

Let your auto insurance agent or car insurance company know that you’ve gotten married. Other household members are generally required to be on your policy if they are licensed drivers, even if they don’t drive your car regularly.

If you and your spouse each have a car and coverage through separate insurers, it usually makes sense to choose one company and buy one policy. You’ll get a discount for insuring more than one vehicle, plus additional savings if you also buy your homeowners or renters insurance from that company.

How to Save on Car Insurance

Even if your insurer offers a discount for insuring two vehicles, it can pay to compare car insurance quotes and shop around for lower rates with other insurers. Muhammad says that he and his wife shop around for their car insurance every two years to make sure they’re getting the best deal.

If you’re happy with your current insurer, ask about other auto insurance discounts that you might qualify for. For example, you might be able to save money by paying your bill annually rather than monthly.

To soften the blow of making a lump-sum car insurance payment, Shepard recommends setting aside money each month in a savings account to have enough to pay the bill when it’s due.

Also ask about increasing your deductible to lower your premium. The average savings for drivers who increase their deductibles can be between 7% and 28%, based on a Forbes Advisor analysis of how much you can save by raising car insurance deductibles.

Homeowners or Renters Insurance

Make Sure You Have Enough Coverage

Now that you’re married, you might have more belongings in your household. So make sure you have enough personal property coverage under your homeowners or renters coverage to replace those belongings in the case your belongings are damaged by a major disaster, such as a fire or tornado.

To figure out how much home insurance you need, start by doing a home inventory. Go room to room and make a list of your belongings and, if possible, their estimated cost. An easy way to do an inventory is to take photos or video of your entire home, including the inside of closets, drawers and storage spaces.

There are also home inventory mobile apps such as My Stuff Organizer and Nest Egg that can help you do a comprehensive home inventory.

If you have an “actual cash value” policy, the payout you would get would cover the cost of your belongings minus depreciation—in other words, their current value. When it comes to replacement cost vs. actual cash value, It’s better to get a policy with replacement cost coverage. This will cost more but it will cover the cost of replacing your items.

If you have expensive items such as wedding rings, artwork or collectibles, you might need to add a floater or rider to your policy to provide additional coverage for those items. Call your insurance agent to discuss your homeowners insurance needs now that you’re married.

How to Save on Homeowners Insurance

Shop around to find the best deal by comparing home insurance quotes from at least three insurers. Or work with an independent agent who can do the shopping for you.

Ask about home and auto insurance bundle discounts. You can save money if you have more than one type of policy, such as homeowners and auto insurance, with an insurer. You can lower your premium by raising your deductible. Adding safety features such as an alarm system and smoke alarms can also lead to discounts.

Keep in mind as you look for ways to save money on all of your insurance policies that it’s important not to skimp on coverage just to save money.

“Shorting yourself on insurance is a fool’s endeavor,” Jones says. Paying for good insurance can seem unnecessary if you never make a claim. But insurance is for the disasters in life, so you don’t have to gut your savings or lose your home or vehicles without a financial safety net.

Life Insurance for Married Couples Frequently Asked Questions (FAQs)