Which life insurance product is designed primarily for estate planning and pays the death benefit only when the second of two insureds dies?

Why A is correct

Survivorship, or second-to-die, life insurance insures two lives and pays the death benefit only after both insureds have died. It is commonly used in estate planning to fund estate taxes or provide liquidity that becomes due at the second death, because the federal estate tax burden on a couple's combined estate typically falls after both spouses have passed. The premium is generally lower than on two individual policies because the insurer's exposure lasts until the second death rather than the first. These characteristics make it a staple of estate liquidity planning.

Why the other options are wrong

• B) Joint life insurance pays on the first insured's death, which is the opposite trigger. Because survivorship insurance waits for the second death, it is not interchangeable with joint life coverage.
• C) Decreasing term insurance provides temporary protection that declines over time, typically to match an outstanding mortgage or loan balance. It is a personal protection tool rather than an estate planning product for two lives.
• D) A family income rider pays a monthly income to the family for a stated period after the insured's death. It does not insure two lives and does not defer payment until a second death.

Memory hook

Second-to-die = the estate-tax timer. Payday comes only after both lives end.