Goshert Financial
Type of Coverage.
First-to-Die.
The
Standard insurance policy that pays out the death benefit at the death of the one insured
person. Surviving spouse uses proceeds to retire mortgage, put children through
college and/or provide replacement income to family.
Second-to-Die.
Married
couple takes out this joint policy to pass death benefits to children/grandchildren at the
death of the second spouse. Depending on relative ages and health issues, the
second-to-die policies are generally less costly than for two first-to-die policies taken
out by each spouse. This is because the actuarial assumptions are more favorable to
the insurance company. Second-to-die policies are advantageous to the married couple
when the surviving spouse is no longer concerned about retiring a mortgage, or educating
the children, or replacing lost income.