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How can couples best protect each other?

In short

For most couples in Germany, two separate term life policies taken out crosswise work best: each partner insures the other's life and pays from their own account. The payout then stays free of inheritance tax, and the survivor keeps their own cover. A joint policy is slightly cheaper but pays only once and is awkward after a separation.

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How can couples best protect each other?

What it costs

Monthly premiums per person from published examples and tests, healthy non-smokers in office jobs.

Example	Typical range
Age 25, 200,000 euros, 30 years	about 6 to 7 euros a month per person
Age 35, 250,000 euros, 30 years	about 20 to 60 euros a month per person
Couple, both 35, two crosswise policies of 250,000 euros each	about 40 to 120 euros a month together
Joint policy instead of two single policies	about 10 to 20 percent lower premium

As of October 2026. The range of 20 to 60 euros reflects the test finding that expensive policies cost almost three times as much as cheap ones. The joint policy saving is a guide value from our quoting practice. Your premium depends on age, health, job and smoking status.

Worked example

Unmarried couple, both 35, one child, 250,000 euros cover

How much reaches Anna if Ben dies, depending on who took out the policy.

Ben insures his own life, Anna is beneficiary	250,000 euros payout
Allowance for unmarried partners	20,000 euros
Inheritance tax 30 percent on 230,000 euros	69,000 euros
Anna insures Ben crosswise and pays herself	250,000 euros, no inheritance tax

Same premium, but the crosswise setup leaves Anna 69,000 euros better off. If they marry later the gap shrinks, but the setup does no harm.

Three ways to set it up

You can each insure your own life, insure each other crosswise, or share one joint policy. At first glance the death benefit looks the same. The differences show up in tax, on separation and after the first death.

Crosswise means: Anna is the policyholder and pays for a policy on Ben's life, and Ben does the same for Anna. If Ben dies, Anna is paid from her own contract. Nothing comes out of Ben's estate, so German inheritance tax does not apply.

Setup	Cost	Inheritance tax	After the first death	On separation
Each insures their own life	two premiums	yes, if the allowance is exceeded	survivor stays insured	simple, each keeps their own policy
Two policies crosswise	two premiums	none, if each pays from their own account	survivor stays insured	manageable, policies can be swapped or cancelled
Joint policy	one premium, usually a little cheaper	may apply, depending on setup	contract ends, survivor has no cover	difficult, one contract for two

The tax trap for unmarried couples

Under German inheritance tax law, unmarried partners count as strangers. If you insure your own life and simply name your partner as beneficiary, only 20,000 euros stay tax free. The rest is taxed at 30 percent. On a 250,000 euro payout that is 69,000 euros for the tax office.

Married couples and registered civil partners have an allowance of 500,000 euros. For them, the crosswise setup is mainly about flexibility. If you cover a house and large sums, still check the numbers, because other inheritances from the same person count too.

When a joint policy makes sense

A joint policy can fit if it secures a shared mortgage, you plan to stay together and nobody needs cover after the first death. It may also be cheaper with an age gap, because some insurers price on an average age.

To be honest, the saving is often smaller than people expect. And once the first partner dies, the contract ends. The survivor has to apply again, older and maybe with health issues. With children at home, that is a real risk.

Cover both partners, including the lower earner

Many couples only insure the main earner. If the partner who looks after the children dies, childcare, housework and often the other's working hours are affected. That quickly costs 1,000 euros a month or more.

The sums can differ. Work it out for each partner separately: what would the other be missing? A difference of 100,000 euros or more between the two policies is normal.

When you do not need it

If you both earn well, have no children and no shared loan, each of you could carry on alone. Then term life cover is usually unnecessary. The same applies if you have enough savings to cover the loan and living costs.

Note also that the German statutory widow's pension is only paid to spouses and registered civil partners. Unmarried partners get nothing from it, which makes private cover more important for them.

Step by step

Work out for each partner what the other would be missing.
Clarify whether you are married or plan to be, because of the tax allowances.
Set up two crosswise policies: the partner is both policyholder and beneficiary.
Pay premiums from separate accounts, not the joint account.
Choose a term that runs until the loan is repaid or the children are independent.
Review the policies every few years, especially after marriage, a birth or a split.

Checklist

Both partners insured, not just the main earner
Policyholder is the partner, not the insured person
Premium paid from the policyholder's own account
Beneficiary matches your current situation
Option to raise cover on marriage or birth without new health questions
Health questions answered fully and honestly for both

Common mistakes

As an unmarried couple, insuring your own life and only naming your partner as beneficiary
Setting up crosswise policies but paying from the joint account
Choosing a joint policy although children still need cover after the first death
Not changing the beneficiary after a separation

Questions and answers

Frequently asked

What does insuring crosswise mean?

Each partner takes out a policy on the other's life and is both policyholder and beneficiary. The payout then does not form part of the deceased's estate.

Is a joint policy cheaper?

Usually a little. In return, cover ends after the first death, and it is hard to split after a separation.

Do we have to be married?

No. Unmarried couples gain most from the crosswise setup, because their allowance is only 20,000 euros.

What happens to the policies if we separate?

Crosswise policies can be swapped so each insures their own life again, or cancelled. A change of policyholder needs both partners to agree.

Can the sums be different?

Yes, and that often makes sense. Each sum depends on what the other partner would lose.

Does an unmarried partner get a widow's pension?

Not from the German statutory pension, which only pays spouses and registered civil partners. That is why private cover matters more.

Is cover worth it without children or a loan?

Usually not, if both can live on their own income. Disability cover is often more important then.

Sources

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