When people pass away and leave behind a sizeable estate there are many things to consider. This is an all too familiar dilemma for those who will leave behind large amounts of money and property. The logistics behind the transfer of wealth have unseen consequences that can become a nightmare for the living. When obtaining a life insurance policy, there are things you should keep in mind especially if you have a sizeable estate. One of these considerations is second-to-die insurance.

What is second-to-die insurance? It is a life insurance policy that pays out the benefit only after two people (usually spouses) die. This can ease the transfer of a big estate to the next generation. Why is this? Because the federal government has a spousal exemption, so that no estate taxes are due when the first spouse dies. The taxes come due upon the death of the second spouse.

As you might expect, the taxes on your estate can be substantial, especially for a larger estate with sizeable property and cash amounts. Second-to-die coverage will cover the cost of these taxes and not leave a huge burden for your next of kin, which in most cases are your children.

An additional benefit of second-to-die life insurance is that it allows for lower premiums. This makes it an affordable option, especially when you consider that the face amount must be high to protect a large estate. The premium is calculated by combining the life expectancy of both parties. When combined in this way, the overall cost of the coverage goes down considerably.

To protect your estate for the next generation, by all means look into second-to-die insurance. If you need assistance, you can request help from an independent life insurance agent here.