Second to Die Life (Survivorship) Insurance

Under current federal tax law, the unlimited marital deduction allows one spouse to leave an unlimited amount of assets to his or her surviving spouse, at the first spouse's death. This means there is no estate tax due at the first spouse's death. At the death of the surviving spouse, however, estate taxes are levied and due within nine months of the second death. Since taxes are not due until the second death, a relatively inexpensive type of life insurance called Second to Die (or survivorship) life insurance is often used to help pay taxes. Second to Die Life insurance is usually much less expensive than conventional life insurance and pays off at the second death. Second to Die insurance can be easier to qualify for than conventional life insurance. Often, this coverage is still attainable, even when one spouse's health is not good.