Life Insurance✓ Verified · outline & fact-checked · Sep 2026Difficulty 2/5
Under a joint life (first-to-die) insurance policy covering two people, when is the death benefit paid and what happens to the coverage afterward?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
A joint life policy insures two lives and pays the full face amount on the death of the first insured. The contract then typically terminates, because the risk the policy was designed to cover, the first death, has occurred. This first-to-die design is often used in business settings, for example to fund a buy-sell agreement where two owners need cash when the first partner dies.
Why the other options are wrong
- B) Paying on the second death is the design of a survivorship or last-survivor policy, not a joint life first-to-die policy.
- C) Simultaneous death is not required; the benefit is paid on the first death that occurs for any reason.
- D) The full face amount is payable on the first death, not split into partial benefits paid at each death.
Memory hook
Joint life = one check, first one out. First death triggers payment; the survivor's coverage closes its book.