What type of life insurance policy pays out the death benefit after the last person's death?

The type of life insurance policy that pays out the death benefit after the last person's death is known as Last Survivor Life Insurance, also referred to as second-to-die insurance. This policy is designed to provide financial protection until both insured individuals have passed away.

Last Survivor Life Insurance is often used in estate planning, particularly for couples, as it can help cover estate taxes or provide an inheritance for beneficiaries after both partners are deceased. The key feature is that the death benefit is activated only upon the death of the last insured, making it distinct from other policies that provide immediate benefits upon the death of one insured individual.

In contrast to this, Joint Life Insurance typically pays out after the first insured death, while Term Life Insurance provides coverage for a specific time period and pays out only if the insured dies during that term. Whole Life Insurance, on the other hand, is a permanent policy that provides a death benefit at any time during the insured's life, but it does not specifically cater to the situation of both insured individuals needing to die for benefits to be paid out.