A life insurance policy that covers multiple lives and pays on the death of the first insured is called

Prepare for the Louisiana Series 101 Life Insurance Exam with multiple choice questions and detailed explanations. Enhance your knowledge and succeed in your licensing exam!

Multiple Choice

A life insurance policy that covers multiple lives and pays on the death of the first insured is called

Explanation:
When a policy covers more than one person and the death benefit is paid at the death of the first insured, this is known as a joint life policy. The design focuses on providing funds right after the first death, which can help a surviving spouse or family replace income or cover final expenses. After the first death, many joint life policies terminate, though some variations may continue or have riders. This differs from survivorship (second-to-die) policies, which pay only after the last surviving insured dies, a structure often used in estate tax planning. A family life policy is not defined by paying on the first death, and a joint and survivor policy is intended to pay upon the death of the second insured, not the first.

When a policy covers more than one person and the death benefit is paid at the death of the first insured, this is known as a joint life policy. The design focuses on providing funds right after the first death, which can help a surviving spouse or family replace income or cover final expenses. After the first death, many joint life policies terminate, though some variations may continue or have riders.

This differs from survivorship (second-to-die) policies, which pay only after the last surviving insured dies, a structure often used in estate tax planning. A family life policy is not defined by paying on the first death, and a joint and survivor policy is intended to pay upon the death of the second insured, not the first.

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