How many lives does a survivorship life insurance policy typically cover?

A survivorship life insurance policy is designed to cover two individuals, typically spouses or partners. The key feature of this policy is that it pays out the death benefit only after both insured individuals have passed away. This type of policy is often used in estate planning to provide liquidity for heirs to cover taxes or other expenses that may arise upon the death of the second insured.

One reason for choosing a survivorship policy over traditional individual life insurance is that it can be more cost-effective. Since the policy pays out only after both insured individuals have died, premiums are usually lower than those for two individual policies.

The other choices reflect incorrect concepts regarding survivorship life insurance. One life would pertain to a standard individual policy, while covering three or four lives would fall under different types of insurance products, such as group life insurance or multiple-insured policies, which serve different purposes. The fundamental nature of a survivorship policy is its focus on two lives, which is why the correct answer is that it typically covers two.