What Is Dependent Life Insurance & How It Works In 2021?

By Sa El Published:

Getting life insurance for your spouse or dependent might not be the most pressing thing on your mind at the moment, and you probably don’t even want to think about another bill. 

But hear me out: 

Having life insurance for your dependent is very important and can prevent you and your family from financially suffering if they were die. 

what is dependent life insurance

Today, I will cover what dependent life insurance is, the difference between a dependent and a beneficiary, how dependent child life insurance works, and much more.

What Is Dependent Life Insurance?

Dependent life insurance is a type of insurance policy that pays out for the death of a spouse, child, or other dependents. This type of policy is usually purchased to handle final expenses, and the amount of coverage can be relatively small. 

While it’s easy to think that the death of a stay-at-home spouse or child won’t become a financial burden, it’s just not true. 

Just think about why a stay at home mom needs life insurance; if you were to lose them, you would immediately need to replace all the things they do, such as: 

  • Childcare
  • Housekeeping
  • Chef
  • Someone to do laundry
  • Event planner
  • Shopping
  • The list goes on.

Not to mention that the national average cost for a funeral is around $10,000, and with the average person not having $3,000 in their savings account, it’s hard to believe we will have money saved for an unexpected funeral.

In general, I would recommend that you have an individual and separate policy for your spouse, especially if the only insurance you have is through your job.

What Is A Dependent? & What Is A Beneficiary?

dependent (in life insurance) is someone you will be adding to your primary life insurance policy, such as a spouse or child, so that they can get covered.

beneficiary is a person or entity you decide to leave some type of inheritance to if you were to pass away, like life insurance.

For instance, your sister probably won’t qualify as a dependent for your policy (unless you are taking care of her), but she can be the beneficiary of your life policy.

While they both could be the same individual, they serve two different purposes. 

What Is Dependent Child Life Insurance?

Dependent child life insurance is a type of insurance policy that will pay out the death benefit of a covered child if they pass away.

No one wants to think about burying a child, but financial hardships come with a child passing away.

THE SIMPLY INSURANCE WAY

No Exam Life Insurance made easy.

Agents not required.

Get quotes and sign up online without talking to an agent. But, we are here if you need us. 

Unbiased, expert advice.

Get unbiased insurance education from licensed experts and also avoid dodgy sales calls.

Coverage in minutes.

You can get no exam life insurance coverage within minutes of getting your quotes and applying.

How Does Spouse Life Insurance Through Employer Work?

An employer usually offers spousal life insurance as part of your benefits plan. It is often called voluntary dependent life insurance or dependent group life insurance.

This type of insurance will cover your spouse, kids, or any eligible dependent, based on the rules that have been set in the plan.

If a dependent dies while covered, you will receive the death benefit since the employee is automatically designated as the beneficiary.

The only downside to life insurance through your employer is that you can only obtain coverage during your job's open enrollment period.

Sometimes your coverage won't begin from day one if you go for a dependent life insurance policy.

While this is an excellent option if your spouse or dependent isn't able to get covered through other means, you are probably better off getting them a separate term life policy or a no exam term life policy.

Who Qualifies as a Dependent for Life Insurance?

To determine who will qualify as a dependent, you must first check the definitions in your group life insurance policy.  

Most plans let you add a dependent such as your child or spouse as long as they meet specific requirements, and others even allow you to have other dependent adults. 

Your Spouse

If someone is recognized as your husband or wife by state law, usually, they can be added as a spouse on your dependent life rider. It can also cover a common-law spouse if your jurisdiction recognized the union. 

A domestic partner (depending on the policy) might not be considered a spouse and could possibly need their own policy. 

Children

Your step-kids, biological children, or a  legally adopted child can all be added as a dependent on your life insurance policy.  

These policies tend to last until your kid reaches a specific age, like 18 or 21.  If they are older than the maximum age allowed for kids, you might want to have them obtain their own policy. 

In all honesty, it’s probably a much better option. 

Adult Dependents (Other)

You should look at your policy's specific vocabulary for more details.

However, most adults who depend on you financially or need assistance with daily living activities could be added as a dependent on your policy.

Usually, they must live with you and be unmarried. 

INSURANCE WHERE YOU LIVE

Life insurance by state.

Is Dependent Life Insurance Worth It?

Life insurance for children might seem unnecessary since you don't rely on them financially; however, a dependent's death will create a financial burden and an emotional burden.

If you don't have enough savings to cover the burial of a child, your dependent or a spouse, then dependent life insurance is worth it.

There really isn't any reasons to waste time, you can click here or on any of the above buttons to get started and get your dependents covered.

Frequently Asked Questions


Can I add my wife to my life insurance?

You can add your wife or spouse to your policy as a beneficiary at any time. However, if you are looking to add them to your policy so that they are covered, that’s an entirely different thing, and usually, you can’t add them to an already in-force policy.

How much life insurance do I need at work?

Usually, employers offer life insurance benefits based on one to two times your annual income. For instance, if you make $75,000 per year, your employer could provide you a policy with a death benefit of $75,000 or $150,000. 

Can you have two separate life insurance policies?

Yes, you can have multiple life insurance policies from the same or different life insurance companies. You could have a group life policy through work, an individual term life policy outside of work, and a whole life insurance policy with a different company. It’s even possible to have two separate term life policies with varying lengths of terms with the same company.


Sa El

About the author

Sa El is the Co-Founder of Simply Insurance and a licensed Insurance Agent with over 13 years of experience in the industry.  He specializes in Life & Health Insurance and is certified in Long Term Care Insurance in the state of Georgia. a licensed real estate agent in the state of Georgia (License #382602), an entrepreneur, insurance educator, and freelance writer.


{"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}
>