GUIDE: Discussing life insurance with your partner
Life insurance is an important discussion couples should have if they share assets like savings or a house, are paying off a shared debt, or have children. The main motivator for many Canadians to get life insurance is to take care of their partner and loved ones should something unfortunate happen to them. Talking about death with your partner is not always easy, but vital to make sure you are both taken care of if one of you passes away.
Discussing life insurance policies with a partner isn’t easy. It entails coming to terms with the mortality of your spouse and yourself. Even the thought that oneself might end up surviving alone, without the other, can be uncomfortable.
Moreover, the topic of money and shared finances can add to an already tense discussion. Many couples avoid talking about financial security and death until later in a relationship – which is unfortunate as they could qualify for lower coverage if they had only started their search earlier.
But, perhaps your spouse or partner thinks life insurance premiums are a frivolous expense and financial burden. Or they don’t consider life insurance to be a great investment compared to other options. Maybe they simply hate facing the harsh reality that one of you may pass away.
Today, Canadians are dramatically under-insured. So how can you discuss life insurance with your partner in a constructive manner?
To put it simply, it’s all about fostering trust and empathy between you and your partner through sustained conversation.
Here are some tips on broaching this topic with your loved one without coming off as confrontational and leave you starting a constructive dialogue on life insurance coverage.
How to prepare for the discussion
1) Do your homework on life insurance policies
Bringing up such a controversial topic before doing any research on your own can be a terrible decision. If your spouse is adamant about not thinking about life insurance coverage, that doesn’t mean you can’t start some research yourself.
Fortunately, there are enough online resources to give you a head start. A quick search can reveal a ton of information about the different kinds of policies and how to choose the perfect one for your family. You can find the answers to several questions your partner might have during the oncoming discussion:
- How much coverage do we need?
- How much does life insurance cost?
- What riders are available?
- Is a joint policy better or a single person plan?
- Should we get term or whole life insurance?
As part of the discussion, it’ll help to have some working knowledge about the ins and outs of life insurance. If you go unprepared, your voice might end up drowning out under the barrage of doubts that your partner might have.
If you don’t want to spend time researching the information online, you can also call up an insurance advisor or broker. Most advisors (like those at PolicyAdvisor) are more than happy to help you sort your doubts without charging any consultation fees. They can help out with starting the conversation with your spouse too.
2) Assess your current financial situation
Take a step back and assess where you currently stand financially. Don’t be afraid to check up on your numbers. After all, every penny counts.
Take stock of all your debts and assets. If you have your own house, then what are the mortgage payments and outstanding mortgage debt? What is the premium for your car loan? How long will it take to pay off your student debt?
These costs mount further if you have children. How much do you spend on child care? What about their future education needs?
Most families depend on more than one person’s income to meet their financial needs. Without the support of one spouse, the other might get overburdened in light of all these costs. A life insurance policy can guarantee that your family’s quality of life will continue to be met, even after you’re gone.
Tools like our life insurance calculator can help you assess exactly how much coverage you may need so that you have a solid number in mind when starting a conversation with your partner about how much life insurance you both may require.
3) Set a time to have the discussion
If your partner is anxious about investing in a life insurance policy, surprising them with this discussion may only make them more defensive. Instead, try to find an opportune time when bringing up matters of money and death won’t seem threatening.
Some couples mutually set aside some time during their weekend to have the discussion in a relaxed atmosphere, others wait for a big life event such as childbirth or buying a new house to bring the topic up.
If you choose to go with the former option then let your partner know well in advance. Avoid scheduling this conversation on days when your spouse is stressed or tired. They might not be open to a heated discussion after a bad day at the office.
On the other hand, bringing up life insurance after a big event might be a better choice for younger couples. People tend to be more open to the idea of spending on insurance due to the added financial responsibility of a child, new business, or house.
In either case, set apart enough time to have a fruitful discussion that won’t be interrupted or distracted.
What to talk about
1) Set your long-term goals for the family
You work hard to reach a certain degree of financial freedom for yourself and your family. Choosing the right life insurance policy can help your family remain financially sound should anything unfortunate happen to you.
Once you’ve set the stage for the conversation to begin, list out the common goals you and your spouse wish to achieve. The goals can range from buying a bigger house or a better car, to getting an MBA or doctorate degree. Write down each goal with the financial obligation each goal may have. This will help create a clear picture of any future monetary needs for both of you.
Talking about shared goals allows you to start the discussion on a constructive note as opposed to a conflicting one. Remind your partner that having a life insurance plan can assist the family in reaching all the milestones mentioned in your list no matter what happens to either of you.
2) Calm any doubts about affordability
There is a misconception that life insurance policies are terribly expensive. The truth is that a healthy 30-year old can get adequate insurance coverage for an affordable monthly premium.
If your partner believes that life insurance is grossly overpriced, then taking them through our life insurance quoting tool can be helpful in showing the true cost of a term life insurance policy.
People tend to overestimate the cost of insurance. Under a tight budget, spending a significant chunk of money on insurance premiums can seem like a gamble. The first step you need to take in such a scenario is to show the actual cost of a solid coverage plan. Helping them grasp the idea that insurance won’t put a huge dent on the monthly family budget can help sway them.
3) Project insurance as a family financial plan
Instead of talking about yourself, try to steer the conversation towards the family and its future. Our partners can be more accepting of life insurance if they are made to realize that the plan is to keep the family from financial trouble. Really, life insurance has less to do with death and more to do with securing an income stream for your partner and children. Life insurance plans not only contribute financially but also help your family cope with the loss. Try showing your spouse how finances would work after one of you died, with and without life insurance.
Additionally, the value of a life insurance payout is not tied to any external influences such as fluctuating business profits or lost jobs. It insulates your loved ones from the brutal impact of a financial crisis. They can continue to enjoy their current lifestyles without much sacrifice.
How to follow up on your discussion
Once the conversation is up and you feel like you are in agreement, it’s time to call in the experts. Buying a life insurance policy worth several hundreds of thousands (if not millions) of dollars is not a decision to be taken lightly. Your preliminary research might have provided you with the basics of buying a policy, but only an insurance advisor can assist you with the details of the process.
Getting help from an experienced insurance advisor can help you navigate through the wide variety of choices available while staying informed every step of the way.
After the talk with your spouse, set up a meeting with a licensed broker or advisor. They can suggest the perfect policy for your budget and future requirements after a thorough assessment of your needs.
While life insurance is a dreaded topic of conversation between spouses and family members, keep in mind it may be anxiousness or ignorance that leads to your partner avoiding the topic. With the right research, tools, and guidance of experienced experts, most partners can be convinced of the benefits of having a life insurance plan in place. All it takes is patience, knowledge, and frank conversation.
The information and views provided herein is for general informational purposes only and should not be considered legal or financial advice.
- Death can be a difficult topic to broach with your partner, but important nonetheless to ensure you are both taken care of should something happen to each other
- While both partners may work, expenses like child care, mortgages, and car loans can be difficult to manage on one income
- Speaking with an insurance advisor together can help move the discussion further and figure out the exact coverage you both need