Do both my spouse and I need life insurance?

Married couples and domestic partners organize their finances in all kinds of ways, which can make them wonder if and when both partners need life insurance.

Most figure out they need affordable term life insurance. (If that’s you, congrats, you’ve come to the right place). But if you have coverage, does your better half need it too?

With a marriage or a lifelong partnership comes a myriad of shared financial responsibilities and expenses – as well as dreams you work towards together. Even if one spouse out-earns the other, both bring immense value to the team that would be sorely missed. Not to mention, most people would want to leave their partner in a good – if not better – financial situation, if they could. This is where life insurance comes in.

When both spouses have life insurance, it offers peace of mind that if one person were no longer around, the other wouldn’t be left in a tight financial spot. Life insurance serves as a safety net that you can provide for your partner. The life insurance beneficiary (or beneficiaries) can use the policy’s death benefit to help cover funeral expenses, meet day-to-day living expenses or plan for the future.

We’ve broken financial coupledom down into its four most common permutations, with spousal insurance recommendations to match. Let’s take a look at the different spousal scenarios.

You’re both relying on life insurance through work

One of the biggest misconceptions about life insurance is that if you have coverage through work, you’re set. The reality is that while life insurance through work is a great perk, it’s usually not enough coverage when you have a mortgage or children or any other shared financial obligations with a partner.

Most employer-provided policies are one to two times your annual salary as an employee. Generally, most experts recommend coverage that’s five to 10 times your annual salary.

Additionally, a life insurance policy through work usually isn’t portable, which means when you leave your job, your coverage ends. If you have gaps in your employment, choose to become an entrepreneur, or become sick and need to leave work, you could end up without coverage. With life insurance, you want it to go where you go.

For most young, healthy individuals, it’s more cost-effective (and protective) to have an individual policy either in place of or in addition to your work policy. To get an idea of what term life insurance costs: a 20-year, $500,000 Haven Term policy, issued by MassMutual, would run a 35-year-old man about $23 per month. Get your life insurance quote here.

Quite the bargain for a whole lot of peace of mind.

You’re a working couple with children or are planning to have kids soon

If you and your spouse work and have or are planning to have children, then it’s likely that both of you should buy and maintain individual term life insurance policies.

Securing life insurance for both parents makes it easier for the surviving spouse to keep life as steady as possible for your children after losing a parent. Life insurance can provide the means to cover household expenses, including a mortgage or rent and childcare, without having to worry about the lost income.

If something should happen to one of you, the surviving spouse will need to play both parenting roles. Along with managing a career and earning enough income to continue supporting your family. Having term life insurance policy provides a financial cushion that can be invaluable during an already difficult time.

You have children and one spouse stays at home

Even if one spouse remains at home with the kids while the other earns the primary income, it is essential to maintain two policies. Traditional work isn’t the only type that provides financial value. Any “non-working” parent playing caretaker, nurse, chef, chauffeur and cleaning person knows that.

If a working parent were somehow able to handle the cost and time demands of all the household responsibilities and child care, life insurance can ease the transition and leave a legacy for your children. For instance, depending upon the amount of the insurance benefit, it could provide the financial support for a working parent to take time off to transition kids through their grief and into a new child care routine. Or, help set them up financially for college.

Losing the support of a stay-at-home parent could make it even harder for your family to save for your child’s college costs. Life insurance can give them that gift.

Regardless of who is the primary income earner, both parents should have life insurance coverage until the children are adults.

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You’re a couple without children

If you and your spouse don’t have children, it’s not always necessary for you to hold individual term life insurance policies. However, there are factors for you to consider before you completely write off the decision as a “no.”

Any lifelong relationship comes with shared obligations. Mortgages, student loans, substantial debt, very little savings or any combination of the four, could spell disaster for a surviving spouse. Instead of leaving your better half in a more vulnerable financial situation, life insurance can help cover some of those costs.

With term lengths of 10, 15, 20 or even 30 years, you can select a policy length that fits the needs of you and your partner. And, if purchased while you’re both young and in good health, it can be an inexpensive part of your monthly budget. For example, a healthy 35-year-old man can purchase a 30-year, $500,000 policy starting at about $40 per month. Probably far less than your monthly impulse Amazon orders.

Applying for life insurance

When you’re shopping for life insurance, you’ll find that most fully underwritten policies do require a medical exam to finalize coverage.

However, there are some scenarios where applicants won’t need to take a medical exam. For example, at Haven Life, we offer an InstantTerm process where some qualified applicants, ages 18-59, seeking a $1 million death benefit or less may be able to finalize coverage without a medical exam, based on the information provided during the application process. Customers are notified once an app is submitted if they qualify to skip the exam. [A note from our lawyers: Keep in mind that it’s always very important to be honest in the application process. The issuance of the policy or payment of benefits may depend upon the answers given in the application and their truthfulness.]

Once an application is submitted, Haven Term applicants will know if a medical exam is needed to finalize coverage. In most cases, you will have temporary coverage in the time between application submission and when we receive the medical exam results.

Beyond the price you receive for coverage, it can be helpful to look at a life insurance company’s financial strength ratings. Ratings represent the opinion of the rating agency of the financial strength and ability to meet the contractual obligations of the company being rated, based on the rating agency’s independent analysis. A rating is not a guarantee of financial strength, but it can be considered an indicator.

Term life insurance as your legacy

Term life insurance isn’t a one-size-fits-all solution for couples. Your financial situation, your lifestyle — they all play a significant role in determining if one or both of you need to be insured.

However, life insurance is a very valuable solution for helping to ensure you have a financial legacy to leave your loved ones — no matter the current status of your savings accounts.

The best thing you and your partner can do is to sit down and have a conversation about your wishes for the other person if you were no longer around. And what the financial impact of that loss would be.

It’s not the easiest of discussions, but it’s a vital one. Each person in a marriage or partnership should feel secure and financially protected no matter what life throws at you. Use the information at your disposal to determine as a unit who needs life insurance and how much coverage is required.

After all, peace of mind is key to any happy partnership. To find out exactly what amount of coverage would be best for both of you, use the online life insurance calculator from Haven Life.

It’s not just easier life insurance, it’s an easier life.

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Michael Davis is a freelance writer and editor who has covered everything from fashion and music to parenting, work, and finance. He has been a chef, restaurateur and record label owner.

Haven Term is a Term Life Insurance Policy (DTC 042017 [OK1] and ICC17DTC in certain states, including NC) issued by Massachusetts Mutual Life Insurance Company (MassMutual), Springfield, MA 01111-0001 and offered exclusively through Haven Life Insurance Agency, LLC. Policy and rider form numbers and features may vary by state and may not be available in all states. In NY, Haven Term is DTC-NY 1017. In CA, Haven Term is DTC-CA 042017. Our Agency license number in California is OK71922 and in Arkansas, 100139527.

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