Home » Insurance » Life Insurance » Child Life Insurance

Child Life Insurance: 5 Reasons Why You Should Consider It

Updated: July 19, 2018

Child life insurance may seem counterproductive, because it is usually parents who get insurance to provide benefits for their children.

But child life insurance is useful for parents as a means of protecting them if their child happens to pass away.

Losing a child is devastating, but having to go back to work within a few days is even more challenging.

The last thing a parent wants is to think about bills and expenses when they just lost the most important person in their life.

Child life insurance provides parents with the financial protection they need to properly grieve and mourn the loss of their child.

What is Child Life Insurance?

Child life insurance is a type of life insurance policy where a payout is made if the child passes away before the age where the policy expires.

There are many reasons why parents may want to get child life insurance plans, especially if they are in a situation where both parents must work in order to make ends meet.

Most child life insurance policies are active until the child reaches his or her 18th birthday. This means that if something were to happen to the child – an accident or an illness – that results in their passing, their parents receive the benefit of the child life insurance.

It is also possible to get a child life insurance policy that is active for their whole life. This is a very cost-effective way to get insurance coverage for your kid at a low rate. The premiums for child life insurance are much lower than regular life insurance policies.

There are many reasons why parents may want to get child life insurance plans, especially if they are in a situation where both parents must work in order to make ends meet.

Instead of waiting until your child develops a heath issue at an older age, you can lock them into an insurance rate before they hit their teen years.

What are the Benefits of Child Life Insurance?

There are many benefits of child life insurance, such as the money parents receive should their child tragically pass away.

It is possible to withdraw this money to pay for a child’s college education when they are 18 or 19.

It may seem crass for parents to worry about money when their child passes, but this financial benefit can give parents the time to grieve in peace. Instead of having to rush back to work in order to pay their bills, a life insurance policy provides substantial financial relief.

Another benefit is the fact that these policies build up cash value every year, which is aided by interest. It is possible to withdraw this money to pay for a child’s college education when they are 18 or 19. It is also possible to borrow money against this policy at very low rates.

Parents can use child life insurance to pay for a number of things related to their son or daughter’s life, such as school, college, weddings or vacations.

Since the premiums on child life insurance are fairly low, these policies are extremely enticing for parents who want to keep their kid protected.

How Do Child Life Insurance Plans Work?

Child life insurance plans work in a very similar way to regular policies. When the parents decide to get a policy, they take their child in for physical check-ups and to fill out some forms.

When the checkups are all completed, the insurance company will provide a quote offer along with the details of the policy.

The physical checkup helps the insurance company determine if the child has any pre-existing conditions that may bring up their insurance rate. For example, children with serious illnesses have a much harder time qualifying for child life insurance.

When the checkups are all completed, the insurance company will provide a quote offer along with the details of the policy. This allows the parents to compare several policies to find the one that is right for their situation.

As long as one or both of the parents continue to make the necessary premium payments, this policy will remain active. But it is also possible to get term policies that may come to an end when the child reaches a certain age – usually 18 or 19.

It is important for parents to consider the pros and cons of paying more in premiums for a policy with better coverage, especially if they can afford the extra premiums.

How to Get the Best Whole Life Insurance for Children Under 18?

Getting the best whole life insurance for children under 18 is all about knowing what you want from a policy. Do you want a simple policy that pays a decent amount if your child passes away? Or are you looking for a more lucrative policy, where you can use the policy’s cash value or borrow against this amount?

Make sure you get a policy where there is guaranteed insurability for the child, even if the child life insurance policy is only for a specific term.

Parents must talk with an insurance agent to discuss their options. There are many types of child life insurance policies available. Most policies are term ones, but it is possible to get a great whole child life insurance policy for your kid.

Make sure you get a policy where there is guaranteed insurability for the child, even if the child life insurance policy is only for a specific term.

Having guaranteed insurability means that when the child life insurance policy expires, the insurance provider must offer a whole or term life policy for the individual in question.

Another necessity with child life insurance is a locked-in rate. Do not get policies where the rate is flexible after a few years. This is a tool insurance companies use to increase premiums after a certain period of time.

Companies to Trust for Child Life Insurance

If you are looking for the best child life insurance policy for your kid, you must look to the most reputable companies in the country.

Bigger and more reputable companies also offer more benefits with their child life policies, such as the ability to borrow money against the policy or withdraw its cash value.

Life insurance is one of those things where you can lose a lot if you trust a company that is not reliable. The only way you will have continued protection for your child is if the company providing this policy is still in business.

In addition, the more reputable companies that have been around for decades have better customer service records. It is easier to deal with them if you ever have to claim the policy’s payout.

Bigger and more reputable companies also offer more benefits with their child life policies, such as the ability to borrow money against the policy or withdraw its cash value.

Make sure the policy you choose comes with a guaranteed principal amount. This means you are certain to receive the principal as a payout in the event of your child’s passing, regardless of what happens with investments related to the policy’s cash value.