Policy Types

Future Insurability: One Big Reason to Get Child Life Insurance

There are several reasons to consider life insurance for your child, not the least of which is guaranteeing the ability that they will have some coverage in the future.

Should I Get Life Insurance for my Child?

According to research from the American Council of Life Insurers, only about 15 percent of people under the age of 18 have a life insurance policy. For those that do, the average amount of coverage is typically small, and often just enough to provide the benefit of covering final expenses.1 The fact is, there are many other benefits to purchasing life insurance for your child, including locking in their future insurability.

How Buying Life Insurance For Your Child Today, Can Lock in Their Insurability for The Future

Once a life insurance policy for your child is underwritten and issued, it will stay in force as long as premium payments are being made. This means the following won’t be issues in the future if your child:

  • Develops a serious medical condition.

    Unfortunately, health factors such as juvenile diabetes and depression can make obtaining a policy difficult and sometimes unaffordable.

  • Engages in tobacco or drug use.

    Using tobacco doesn’t mean you’re uninsurable, but it can easily double the rates that you’ll pay. And while the impact of drug usage will vary from carrier to carrier, marijuana and other substances have the potential of making someone uninsurable.

  • Works in a high-risk industry or engages in extreme sports.

    What you do for a living and in your spare time can affect life insurance rates and the possibility insurability when purchased as an adult (working as a private pilot, scuba diving, etc.). Having coverage established as a minor locks a child into a policy and lower rates, and could make these types of activities as an adult immaterial.

  • Has a not-so-healthy family history.

    While family health history doesn’t necessarily affect a minor’s insurability, it factors into how much they’ll have to pay for insurance when they’re in their prime income-earning years as an adult. For example, some insurers may increase the rates of life insurance if a parent or immediate family member died before a certain age due to cancer or heart disease. By purchasing a policy today, you can leverage the benefits of securing a more affordable policy despite your family’s health history

  • Needs more coverage as they become older.

    Many life insurance policies may offer optional endorsements and/or riders for an additional premium. For example, the guaranteed insurability rider allows you to purchase extra insurance in specified increments and at specified times without having to prove insurability. And term life policies might include a conversion feature that allows you to convert some or all of your term life insurance policy to a permanent policy such as a whole life, universal life insurance, or variable life.

Buying life insurance for children may be an ideal, low-cost way to make sure that they’ll have life insurance as an adult in case of an illness or other factor later in life may make them uninsurable. A qualified life insurance professional can help you select the policy that’s right for your child, ensuring a brighter future.

1. American Council of Life Insurers Research Study, 2013

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All Learning Center articles are general summaries that can be used when considering your financial future at various life stages. The information presented is for educational purposes and meant to supplement other information specific to your situation. It is not intended as investment advice and does not necessarily represent the opinion of Protective Life or its subsidiaries.

Neither Protective Life nor its representatives offer legal or tax advice. We encourage you to consult with your financial adviser and legal or tax adviser regarding your individual situations before making investment, social security, retirement planning, and tax‐related decisions. For information about Protective Life and its products and services, visit www.protective.com.

Child Life Insurance Policy

A child life insurance policy may be uncomfortable for parents or grandparents to consider, but there are several practical benefits that could be helpful for your child as they grow up. From lower premiums to securing future insurability, a child life insurance policy can benefit your child well into adulthood. For more information, visit our learning center.