Life Insurance

Life insurance for your children?

Term life insurance is temporary protection. For children, this is typically only purchased to provide a death benefit to the parents or guardian to cover the child’s burial expenses should an unlikely (and certainly unwanted) death occur.

Term life does not build any cash value and has no future benefit to the child later in life. The premium payments will be increased when the policy renews. Term offers only a death benefit and nothing more. There is no investment or cash value that builds in a term policy.

Whole life insurance however, is commonly purchased for children to provide both burial expenses as well as, an investment opportunity for the child that will benefit them later on in life. Purchasing a Whole life policy for a child while they are young is very inexpensive in comparison to them buying it later on in life. Cash value begins building the end of the third year that the policy is in force.

If you make an educated decision, you can invest in your child’s future by opting for a whole life policy. The accumulated cash value at age 65 is generally enough to provide a reasonable retirement fund if the face value of the policy is great enough.

Compare quotes and policy details from several companies before making a final decision. Different insurance companies charge different premiums for the same policy face value. Get as much whole life coverage for your children as you can afford. It will benefit them and their future family long after you’re gone.

Nate Akers
Licensed Insurance Expert