How does a joint life insurance policy function?

A joint life insurance policy is specifically designed to cover two individuals under a single policy. It operates in such a way that a benefit is paid out upon the death of the first insured person. This type of policy is often utilized by couples, business partners, or others who have shared financial responsibilities, ensuring that the death benefit can provide financial aid to the surviving individual in managing costs associated with the loss, such as funeral expenses, outstanding debts, or loss of income.

The other options do not accurately reflect the nature of joint life insurance. While the policy can be advantageous for married couples, it is not limited to them, as it can apply to any two insured parties with shared financial interests. The option that states it pays benefits only after both insureds have passed away describes a different type of life insurance known as a survivorship policy or second-to-die policy, which is not the same as a joint life policy. Lastly, while a surviving spouse can often make adjustments to their insurance needs, this is typically not a feature of joint life policies, and is unrelated to how they function.