Life Insurance for Children

Life insurance for children comes in several forms.  Know the pros and cons of each type of coverage before deciding which policy type and death benefit amount fits your needs:

• Cash Value Life Insurance
  • Whole Life
  • Universal Life
• Term Life Insurance

Children life insurance can come in the form of cash value policies. The primary advantage of purchasing a cash value life policy for your child is the low rates, and rapid cash accumulation.

Purchase your cash value policy while your child is young and healthy. If healthy, your child's underwriting process will be simple and go smoothly. Because your child has a long remaining life-span premium rates will be far more affordable compared to when purchased later in life.

Cash value policies are designed as permanent coverage: you keep the policy for life. Premium rates are designed to be either fixed or vary within a very narrow range.  Buy purchasing a policy when your child is young, you lock in low rates for a life-time.

Cash accumulation is a second advantage of a life policy for children. The life protection cost of the contract will be fairly low, meaning a greater percentage of the premium will go towards cash accumulation in the early years of the contract. This creates an asset that your child can borrow against or cash out when needs arise - like college expenses.

The two most common forms of cash value life coverage for children are whole life and universal life insurance.

Whole life insurance for children works great for people who love guarantees. Whole life guarantees the death benefit, premiums, and cash value. Whole life offers lifetime death benefit protection that will not change as long as premium payments are made on time.

The premiums will stay the same during the life of the contract no matter what happens to the health of your child. Cash value amounts are guaranteed at specified time intervals as long as premiums are paid on time.

Universal life insurance for children appeals to families who like flexibility. Universal life offers flexibility in death benefit, premiums, and cash accumulation models. Children's Universal life allows you or your child to make adjustments in the death benefit and the amount of premium paid as needs change over time.

You can choose between cash accumulation schedules. You can elect to make additional premium payments that build cash accumulation more quickly. 

Term life insurance for children provides a fixed death benefit and level premium for a specified term: 10, 20, and 30 year terms are most common. Term life is the most affordable option for a specified death benefit as there is no cash accumulation, and the policy is likely to expire while your child is still alive.