Wills and Estate Planning

Survivorship Life Insurance in Estate Planning

Survivorship life insurance is commonly used to preserve your estate, ensure funds for a special needs child, establish a trust or as a benefit to charity.

Understanding Survivorship Life Insurance in Estate Planning

Whether you're looking to preserve your estate for tax planning purposes, ensure the availability of funds for a special-needs child, establish an educational trust, or provide a lasting benefit to charity, life insurance can play an integral role in the estate planning process. But before you consider using life insurance as part of your estate plan, it's important to understand the types of survivorship life insurance policies commonly used for this purpose.

Second-to-die life insurance

Second-to-die life insurance is also referred to as joint survivor or survivorship life insurance. It is different from traditional life polices in that it insures the lives of two people (typically married) under a single policy and pays out the death benefit only after the second insured dies. Second-to-die life is often more affordable (because you're purchasing a single policy instead of two separate policies and because both policyholders must die before a benefit is paid), and it can sometimes be easier to qualify for a policy in underwriting. Traditionally issued as a permanent* policy (whole or universal life), second-to-die life can also be underwritten on a term life insurance policy form.

Universal and variable universal life insurance

Universal and variable universal life insurance are sometimes used in survivorship estate planning. As permanent policies, they afford the flexibility to vary the amount or timing of premium payments, and the death benefit may be adjusted up or down (in accordance with the plan limits) without having to purchase a new or separate policy. And because these policies can grow in value, they allow you to build an estate, not just insulate it from taxes. It is important to note that variable life growth is based on the investment performance of the selected investment funds inside the policy.

Single-premium variable life insurance

Single-premium variable life insurance allows you to buy insurance with a single premium (lump sum) payment in return for a guaranteed death benefit that will remain paid-up until you die. Because the costs are paid in full and upfront, the cash investment can grow quickly and your insurance coverage is entirely paid by the account value of the policy which grows if the underlying investment earnings are positive rather than with annual premiums. This policy allows your named beneficiaries to receive benefits income tax-free and without the time delay and expense of probate costs.

Which type of survivorship life insurance policy is right for you?

Consult with a qualified life insurance professional and consider the following questions:

  • Do you need/want to transfer wealth in a tax-efficient manner?
  • Do you need to ensure that funds are available for fees, taxes, and other estate expenses?
  • Do you need to provide funding beyond your lifetime for care of a child or other dependent with special needs?
  • Are you interested in a life insurance policy with a tax-deferred investment component that could potentially increase the amount of your death benefit?
  • Do you have assets that are difficult to divide and feel you should equalize your estate among your beneficiaries?

Life insurance needs arise from both personal and business concerns and can include cash for estate tax liabilities, funding a college education for grandchildren, or to fund a trust for a disabled child. For these and similar second death concerns, second-to-die insurance can often be the right policy in estate planning.

*As long as required premium payments are timely made.

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Survivorship Life Insurance

When planning to preserve your estate, there are many things to take into consideration. Survivorship life insurance policies are commonly used to ensure availability of funds for a special-needs child, an educational trust or provide a lasting benefit to charity. This article considers how to know which type of survivorship life insurance policy is right for you and your dependents. For more information, visit our learning center.


All Learning Center articles are general summaries that can be used when considering your financial future at various life stages. The information presented is for educational purposes and is meant to supplement other information specific to your situation. It is not intended as investment advice and does not necessarily represent the opinion of Protective Life or its subsidiaries.

Learning Center articles may describe services and financial products not offered by Protective Life or its subsidiaries. Descriptions of financial products contained in Learning Center articles are not intended to represent those offered by Protective Life or its subsidiaries.

Neither Protective Life nor its representatives offer legal or tax advice. We encourage you to consult with your financial adviser and legal or tax adviser regarding your individual situations before making investment, social security, retirement planning, and tax-related decisions. For information about Protective Life and its products and services, visit www.protective.com.

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