For children, there are really only a couple reasons for life insurance.
We see a lot of parents who want to provide an asset for their kids to use when they are older, for college or even when they have a family of their own. You can over-fund a life policy to create a cash value which can be withdrawn or taken out as a loan. Not a bad way to get a tax-free income.
The other reason is to just provide some coverage for the what if. We all see stories of children death caused by a lot of reasons. This does provide a ray of sunshine in a time of extreme emotion and hardship.
While medical advances are making more illnesses treatable, they also are making us aware of more illnesses, and allowing them to be diagnosed at an earlier stage. Any type of illness has the potential to cause life insurance rates to go up, and some illnesses limit the type of policy/amount of coverage you can get. Getting life insurance on a child helps you lock in a good rating before them, so that no matter what diagnosis they may develop as adults, their life insurance is take care of.
Insurance Advisor, Lordship Insurance Services, California
Insurance serves the primary purpose of protecting us against risk. When we take out a policy it is to help us with the loss of a loved one. Children need a policy because they create a loss in the event of their untimely death. In addition if a child gets a good policy at an early age while they are still healthy they can get the best policy for the best price.
Licensed Life Agent, Life and Finance/ 50 States, New York
Families are more financially secure with children insured too. With risk of a burden after mishap of losing a younger member. Children`s rates are lower and coverage can begin from age 0 to age 25 and to resume at guaranteed issue once at that age. This is when the child is grown and is no longer dependent upon the parents. The child may now own his/her policy for their family. Insurance for children can only be at a maximum of 50,000 depending on the policy and how much the parents may own.
Agent Owner, Gilmore Insurance Services, Marysville, Washington State
Why should kids have life insurance? Several reasons make it a good idea. First by purchasing a permanent policy you set the foundation for your child's financial future. Think of it as raw land to be developed over time. It will be cheap but work very nicely through time.
Next you can guarantee your child's insurability down the road by the use of a rider that guarantees the insurance company can't say no later on. Taking away the NO is a bigger deal than you might think. How many times can you think of that being the situation?
And finally, for the worst possible thing, a child dying. The life insurance gives you a chance to grieve, pay for a service and not make lack of money make a terrible situation worse...
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We see a lot of parents who want to provide an asset for their kids to use when they are older, for college or even when they have a family of their own. You can over-fund a life policy to create a cash value which can be withdrawn or taken out as a loan. Not a bad way to get a tax-free income.
The other reason is to just provide some coverage for the what if. We all see stories of children death caused by a lot of reasons. This does provide a ray of sunshine in a time of extreme emotion and hardship.
Next you can guarantee your child's insurability down the road by the use of a rider that guarantees the insurance company can't say no later on. Taking away the NO is a bigger deal than you might think. How many times can you think of that being the situation?
And finally, for the worst possible thing, a child dying. The life insurance gives you a chance to grieve, pay for a service and not make lack of money make a terrible situation worse...