I am frequently asked by parents if they should buy life insurance for their children. My
answer is for them to look at all the choices and decide what makes the most sense for their family.
The most important thing for the family is to first make sure that the parents are properly insured. Only when that has been achieved does it make any sense to even consider insurance on the child.
I have always had insurance on my children and now my granddaughter. For me it made sense for several reasons. My reasons for purchasing the coverage are:
Provide money for funeral expenses should they be needed. This is the same reason why an adult would buy at least a minimum amount of insurance. It is much less expensive to put the financial burden on the insurance company. I will never pay anywhere near an amount of total premium equal to the face amount. I am buying the coverage at a great discount.
To make sure that they always had some coverage. We never know when our health or the health of our children may change. We all become uninsurable at some point in our life. To help them to be able to have an adequate amount of insurance in the future, I also added an option that allows them to purchase more coverage several times in the future as adults.
The policy cash values are available in the event of an emergency or for additional college funds.
By purchasing coverage at such a young age, it is substantially less expensive than it will be when they are older.
By letting them know I have purchased insurance on them, it helps them learn the importance of making proper financial decisions, including maintaining adequate insurance coverage.
