Should I buy life insurance for my children?

Buying life insurance for your children can be a good investment that both prevents a major financial burden on parents and serves as an investment for children. Most children's life insurance policies are a form of whole or permanent life insurance that build cash value. The amount you pay for children's life insurance will depend on the child's age, the coverage amount, and the period that you pay into the policy.

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Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health in...

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Benjamin Carr was a licensed insurance agent in Georgia and has two years' experience in life, health, property and casualty coverage. He has worked with State Farm and other risk management firms. He is also a strategic writer and editor with a background in branding, marketing, and quality assurance. He has been in military newsrooms — literally on the frontline of journalism.

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Reviewed by Benji Carr
Former Licensed Life Insurance Agent

UPDATED: Jan 7, 2022

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Quick Facts

  • The life insurance policy you purchase for your child will depend on their age and the purpose of the coverage
  • Some life insurance companies offer whole life insurance for children under 18
  • It’s important to consider payment terms, coverage amount, and your child’s age when buying life insurance for kids

If you have or are planning on having children, you might wonder if you should purchase life insurance for your child. Buying permanent life insurance for your children could be a wise decision in the long run.

It’s not always necessary to buy life insurance for your children. We’ll help by explaining when you should purchase life insurance for your children, how to buy your child’s life insurance, and more.

Continue scrolling to learn more about how to purchase life insurance for children, or enter your ZIP code above to obtain free quotes from the leading life insurance companies in your area.

Should I buy life insurance for my children?

Most people purchase life insurance policies to ensure that their loved ones don’t inherit financial distress upon their passing. Parents aren’t typically reliant on their children for money, so they might overlook the benefits of buying their children a life insurance policy.

Of course, “children” covers a gamut of ages which plays a role in how you will purchase life insurance for your children if desired.

For example, you would most likely buy a different life insurance policy with various coverage amounts for your adult children than you would for adolescents.

That said, there are benefits to purchasing life insurance policies for children of any age.

When should I buy life insurance for my children?

As mentioned above, there are varying expectations for purchasing a life insurance policy for your children depending on their age and other factors.

Realistically, there isn’t an inappropriate time to purchase a life insurance policy for most children. Your child’s age will simply determine the type of policy you choose and the amount of life insurance coverage you will want to invest in.

There are several suggested life insurance options for your children, but the two most common are children’s life insurance and term life insurance.

For adolescents or youth, people often choose children’s life insurance while adult children would be more likely to receive a term life insurance policy.

What type of life insurance policy should I buy my child?

As previously stated, your child’s age will be the key determinant when deciding what type of life insurance policy to purchase.

Children’s life insurance is typically a form of whole life insurance — or another type of permanent life insurance — rather than a traditional term life insurance policy.

Permanent life insurance policies serve as somewhat of a savings account for your children if you are paying for the policy. Most child life insurance policies are only eligible for children under the age of 18.

If you believe that an unexpected expense of $5,000 or more would be detrimental to your financial situation, it could pay off to invest in children’s life insurance.

According to the National Funeral Directors Association, the average funeral costs $7,848 and can become more expensive for certain services or the location.

Different companies will offer dissimilar policy coverage amounts, often ranging somewhere between $10,000 and $50,000 with some companies offering more or less coverage.

Before you commit to any children’s life insurance policy, you’ll want to determine how much coverage is appropriate.

If you have adult children and are considering buying them a policy to help support their family or yourself if they pass, term life insurance is still a viable option. It could, however, be worthwhile to invest in a return of premium rider with those policies.

In short, a return of premium life insurance policy would elicit a refund of all or some of the premiums you paid if your child outlives their term life insurance policy.

This type of feature often involves an added expense, however, it could ultimately save you thousands of dollars if your child outlives their policy.

Overall, the policy you select will be dependent on your financial situation, your child’s age, and your family’s personal situation.

How much will I pay for life insurance for my children?

Your child’s life insurance policy expenses will depend on the policy type you choose. Beyond that, the company you select will determine your life insurance rates and could play a big role in how much you pay. This is why it’s important to compare rates from multiple companies.

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Although numerous companies offer whole life insurance, not many will provide a child a whole life insurance policy.

Some companies specialize in children’s life insurance whether it be a permanent life insurance policy or more of a final expense insurance policy. Gerber Life is one of the companies that specialize in children’s life insurance.

Gerber Life children’s life insurance is referred to as the Gerber Grow Up® plan. The Gerber Life Grow Up® plan is a kid’s life insurance policy that is designed to double in value by the time they turn 18.

With this type of policy, the amount you pay will vary greatly depending on the coverage amount you choose and your child’s age when you decide to purchase the policy.

If you wait until your child is 15 to buy the policy, that would leave only three years to double the policy amount which would be much more expensive each month than if you started their policy at six years old.

Globe Life advertises life insurance for children with a “$1 Buys $30,000” slogan, but that one dollar is simply the payment for the first month. The future monthly payments would still depend on your child’s coverage and age.

There are a handful of reputable children’s life insurance policies which include the following:

  • Gerber Life
  • Globe Life
  • New York Life
  • Mutual of Omaha
  • Aflac

Many other companies, such as State Farm and Prudential, will offer a children’s life insurance rider that can be added to your life insurance policy, as well as various other family life insurance options. Again, costs will still depend entirely on your coverage amount.

Though Gerber Life Insurance is one of the best-known companies for this type of policy, it’s always a good idea to explore your options.

More to Consider When Buying Life Insurance for Kids

You will want to be attentive when purchasing a life insurance policy for your child. If you buy them a whole life insurance policy, you will want to determine the penalty if the policy is surrendered.

If you purchase the policy and pay for 30 years and they decide they no longer want the policy after you pass, you don’t want them to lose a large sum of the cash value that you paid into.

Additionally, whole life insurance policies for children sometimes offer different payment periods. Although these policies offer permanent life insurance coverage, the payment period can sometimes be shorter so there is less likelihood of the policy being surrendered by a naive child.

Otherwise, you will need to determine more traditional factors such as the coverage amount, your child’s beneficiaries, and which life insurance company is most suitable.

It’s always important to share your child’s life insurance information with them, once they are mature enough to understand the purpose of the policy and how it should be used.

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Buying Life Insurance for My Children: The Bottom Line

Buying life insurance for your children is a unique process that requires many considerations. Children’s life insurance could prevent a sudden financial burden on parents while serving as a strong investment for children.

So, should I purchase life insurance for my children? If you have the financial means to buy your child a life insurance policy, it can be a smart investment for you and your child.

Hopefully, this clarifies how to go about buying life insurance for your children. Don’t forget to enter your ZIP code to obtain free quotes from the top life insurance companies near you today.

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