UPDATED: Mar 26, 2020
We strive to help you make confident insurance decisions. Comparison shopping should be easy. We partner with top insurance providers. This doesn't influence our content. Our opinions are our own.
It may seem strange to think about buying term life insurance for a child. After all, beyond the emotional loss, your family likely wouldn’t suffer from the loss of income, which is typically the reason people buy life insurance in the first place. Life insurance is designed to care for loved ones that depend on you once you are gone, it does not make sense to purchase a life insurance policy for a child. You don’t need life insurance for your children as they do not have dependents that need financial care once they are gone.
Of course, there are some reasons to get your child life insurance. When considering purchasing such insurance for your children, think carefully about how their death could affect you financially. Consider expenses such as funeral costs and, depending on the age of the child, the possibility of having to take care of any unsettled debts. In this case, term life insurance for a child does make sense. Burying a child is unimaginable, but struggling to pay for the funeral would make it even more challenging.
Unfortunately, very few insurance companies offer separate policies for children. There are child riders, however, which many companies offer as an add-on to a parent’s insurance coverage. Typically parents can pay an additional flat fee and in the unfortunate event that their child died they could receive some coverage for these costs.
Reasons to Buy It
Some say that the only reason for buying life insurance for children is if there is a family history of health problems, such as diabetes or heart disease, which might make it tough for them to get insurance when they’re in their prime years. It is impossible to determine how much a child will earn in the future. The best life insurance policy for children is on a 20-year policy. When the life insurance policy expires, you can find one that is renewable with the option of converting to more permanent insurance. A great benefit of this is that most carriers will not ask for any medical exams since the insured has already built a history with them.
Is it a Good Investment?
Life insurance policies for children are also available as an investment to save for the future. Term life provides coverage for a predetermined term. You can find some policies which can be converted to more permanent life insurance which typically provides coverage for the entire life of the policyholder while also building cash value for them that they can cash in when they get older.
Insuring a child is not necessarily the best idea for everyone. QuickQuote agents can guide you through the advantages and disadvantages of insuring your child. Contact one of our agents today to learn about all the variable products of life insurance for children to find the option for you and your family.