What is survivor (second to die) life insurance primarily used for?

Survivor (second to die) life insurance is designed specifically for estate planning purposes, meaning that the death benefit is paid out only after both insured individuals—the spouses—have passed away. This type of policy is particularly beneficial for couples who wish to leave their heirs a financial legacy or cover potential estate taxes that could arise when both partners die, thereby preserving their estate for beneficiaries.

The structure of this insurance allows couples to obtain a larger death benefit for a lower premium than if they were each to purchase individual policies. This can make it an effective tool for wealth transfer, ensuring that the financial implications of both deaths are managed effectively, especially in the context of estate taxes or other liabilities.

It does not primarily serve purposes like providing immediate cash for final expenses, covering income loss, or focusing on investment growth during the couples' lives, as those aspects pertain more to other types of insurance products or planning strategies.