Comments on: Buying Life Insurance on a Child’s Life

By: Why I am Purchasing Whole Life Insurance on Child or Baby

Why I am Purchasing Whole Life Insurance on Child or Baby — Tue, 17 Jan 2012 15:35:22 +0000

[...] have approached the subject of buying life insurance on a child with The Wife prior to the birth of Baby Boy, and she made it pretty clear that she thought the [...]

By: Regardless of Cost or Debt You May NEED a Nice Car | My Journey to Millions

Regardless of Cost or Debt You May NEED a Nice Car | My Journey to Millions — Mon, 08 Aug 2011 13:51:38 +0000

[...] in life I just canâ€™t agree that something is always bad.Â Â Â Hey, I am the guy that advocates buying life insurance on a child, how is that for going against the grain?When I Think You Need a Nice CarAs Len points out in his [...]

By: Evan

Evan — Thu, 16 Sep 2010 14:37:12 +0000

That is actually a great point. I know my buddy, who is a type 1 diabitic, WISHES his parents did that. His premium (we are 28) is 6x what I have to pay. Can you say OUCH

By: paul

paul — Wed, 15 Sep 2010 13:30:05 +0000

My agent had me get 25K whole life policies on all my kids not just for funeral expenses and time off but for when the kids become adults they are pre-qualified to buy 50k additional whole life every 3 years starting at age 18 without a physical.

By: Evan

Evan — Wed, 21 Jul 2010 18:20:03 +0000

While your emergency fund will take care of it, buying a 20 year term or a Whole Life product on a 1 or 2 year old is CHEAP like pennies on the dollar cheap.

Your example is a rough one. Did you talk to them about collapsing the policies and take the CSV or offer to ‘sell’ it to the children. Depending on the company they can turn that whole life product into a stream of income to help with their retirement. That is the kind of agent that gives the whole industry a bad name.

By the way, love your site Jeff…thanks for stopping by here.

By: Jeff Rose

Jeff Rose — Wed, 21 Jul 2010 18:06:44 +0000

That is an interesting point of view. I have to admit that I never thought of it from that angle, too. I will say this, if you have an emergency fund (which ours right now is in the 12 month range of expenses) then that would take care of it for a bit.

As I mentioned in my Tweet, it’s hard to argue about someone paying $5-$15/mo for a policy- as long as they are saving way more than that in retirment accounts and such. I just had an example of a retired couple with limited income that were paying on policies for 2 adult children and 4 grandchildren. The husband had been recently laid off and their insurance agent was telling them to buy more insurance!!!! I was horrified. No future income in sight on a limited budget, they were already shelling out over $400/mo in insurance premiums and he wanted them to buy more. Needless to say he is now their “former” insurance agent.

By: Evan

Evan — Mon, 05 Oct 2009 15:25:14 +0000

Great minds must think a like, because my wife asked me the same exact question when she read the post.

If it does not then we know the argument for life insurance on the child…but even if we assume it does cover the emotional trauma, I still think the post is valid for a couple reasons:
1) Most people don’t have individually owned DI, they have employer based DI which means they lose their job and their child they are SCREWED.

2) Depending on the state DI will only ocver 66% of the income, which is normally great but we discussed a need for 100% replacement

3) Combining both of the points – every policy is different, some have a month window of you being on your own, some have 90 days of you without income draining your savings (if you have any).

Just some thoughts.

By: M

Mon, 05 Oct 2009 15:03:13 +0000

Not morbid at all. Quite appropriate.

I never considered this. I’ve always laughed at the thought of buying life insurance for a child. Now it kinda makes sense.

I wonder– would the inability to work after the loss of a child due to emotional trauma be covered under a disability policy?