Many parents and guardians have questions about life insurance for children.
Some see it as an unnecessary expense, while others view it as a valuable financial tool for securing a child’s future.
Choosing the best life insurance for kids involves weighing various factors, including policy types, coverage amounts, and potential benefits. By understanding the options available, you can decide if this type of insurance aligns with your family’s long-term financial goals and needs.
1) Gerber Life Grow-Up Plan
The Gerber Life Grow-Up Plan is a whole life insurance policy designed specifically for children.
It offers coverage ranging from $5,000 to $50,000, providing lifelong protection as long as you pay the premiums.
One unique feature of this plan is that the coverage automatically doubles when your child turns 18, without any increase in premiums.
This can give your child a financial head start as they enter adulthood.
As a whole life insurance policy, the Grow-Up Plan builds cash value over time.
This can serve as a nest egg for your child’s future, which they can borrow against if needed.
You remain the policy owner until your child reaches age 21.
At that point, ownership transfers to your child, who can then choose to continue the coverage or make changes as they see fit.
The plan is available for children aged 14 days to 14 years.
Premiums are locked in at the child’s age when you purchase the policy, meaning the earlier you buy, the lower the rates.
Monthly premiums can be quite affordable.
For example, a $10,000 policy for a healthy child under one year old might cost around $6.35 per month.
It’s important to note that while the Grow-Up Plan offers guaranteed coverage, the death benefit amounts are relatively low compared to adult life insurance policies.
Consider your family’s specific needs when deciding if this plan is right for you.
2) Mutual of Omaha Children’s Whole Life Insurance
Mutual of Omaha offers a children’s whole life insurance policy designed for children aged 14 days to 17 years old.
This policy provides lifelong protection with premiums that are guaranteed to remain the same throughout the insured’s life.
You can choose coverage amounts ranging from $5,000 to $50,000 for your child.
The policy builds cash value over time, which can be borrowed against or withdrawn if needed.
The monthly cost for Mutual of Omaha’s children’s life insurance typically ranges from $10 to $17 for approximately $25,000 in coverage.
The exact price depends on your child’s age and the coverage amount you select.
Mutual of Omaha uses a five-year age band system to determine rates.
This means children within the same five-year age group will have similar premium costs.
One advantage of this policy is that it guarantees future insurability.
Your child can purchase additional coverage later in life without proving insurability, regardless of their health status.
Mutual of Omaha ranked above average in J.D. Power’s 2023 U.S. Individual Life Insurance Study.
This study evaluates factors such as price, product offerings, and company communication.
When considering this policy, weigh the potential benefits against the long-term financial commitment.
While it provides lifelong coverage, you’ll need to maintain premium payments to keep the policy active.
3) State Farm Children’s Term Life Insurance
State Farm offers a child term rider that you can add to your own life insurance policy.
This rider provides coverage for children up to age 25 or until the policyholder turns 65, whichever comes first.
One rider could provide up to $20,000 in life insurance coverage for each child in your family.
This includes children yet to be born, as new children are covered once they reach 15 days old.
The child term rider is a cost-effective way to ensure all your children have some level of life insurance protection.
It’s particularly useful if you have multiple children, as one rider covers all of them.
When your child reaches age 25, you have the option to convert the term coverage to permanent coverage.
This allows your child to maintain life insurance protection into adulthood.
State Farm’s Select Term Life Insurance policies offer coverage for periods of 10, 20, or 30 years.
You can choose the length of time based on how long you need the coverage to last.
To get a quote for State Farm’s term life insurance with a child rider, you’ll need to contact a State Farm agent.
They can provide personalized information based on your specific needs and circumstances.
4) Forester’s BrightFuture Children’s Whole Life
Forester’s BrightFuture Children’s Whole Life insurance offers lifetime coverage for children up to age 121.
You can secure this policy for children from birth to 18 years old.
The policy provides guaranteed level premiums, which means your payments won’t increase over time.
You have the option to pay premiums for either 10 years or until the child reaches age 100.
One key feature of BrightFuture is its income tax-free death benefit.
This can provide financial protection for your family in the unfortunate event of a child’s passing.
Face amounts for this policy range from $5,000 to higher coverage levels.
This flexibility allows you to choose a coverage amount that fits your family’s needs and budget.
BrightFuture also offers additional riders, which can enhance the policy’s benefits.
These riders may provide extra protection or features tailored to your specific requirements.
It’s important to note that any loans taken against the policy will reduce the death benefit.
This is a common feature of whole life insurance policies, but it’s crucial to consider when managing the policy.
When considering Forester’s BrightFuture, compare it with other options like Mutual of Omaha’s standalone policy or American Family’s coverage options.
This will help you make an informed decision based on your family’s unique circumstances.
5) Globe Life Young American Plan
Globe Life offers a whole life insurance policy for children called the Young American Plan.
This plan provides coverage for kids between the ages of 0-24.
You can purchase coverage amounts ranging from $5,000 to $30,000.
The policy builds cash value over time that your child can access later in life if needed.
One advantage of Globe Life’s plan is its affordable monthly premiums starting at just $2.17.
This makes it accessible for many families looking to secure coverage for their children.
The application process is straightforward.
You can get an instant quote and apply online quickly.
Alternatively, you can connect with an agent or request information by mail.
Globe Life allows you to lock in low rates while your child is young.
As your child grows, the premium stays the same but the coverage continues.
It’s important to note that Globe Life’s maximum coverage amount is lower than some competitors.
Some other insurers offer up to $50,000 in coverage for children’s policies.
Unlike some other children’s life insurance plans, Globe Life does not include any free add-on riders.
This means you won’t get extra benefits beyond the basic coverage.
When considering this plan, weigh the affordable premiums against the coverage limits and lack of additional features.
Your specific needs and budget will determine if the Young American Plan is the right choice for your family.
6) American Family Children’s Whole Life
American Family Insurance offers a whole life insurance policy for children that provides long-term protection.
This policy is designed to safeguard your child’s financial future, even if their health changes over time.
The DreamSecure Children’s Whole Life Insurance builds cash value as your child grows.
This feature allows the policy to become a valuable asset that can be used later in life.
You have flexibility in payment options with American Family.
They offer 10-year and 20-year payment plans for their children’s whole life insurance policies.
One key benefit of this policy is that it guarantees the option to purchase additional coverage at certain milestones in your child’s life.
This ensures that their protection can grow as their needs change.
American Family’s children’s whole life insurance is available for kids from 14 days to 17 years old.
The coverage amounts can vary, allowing you to choose a policy that fits your family’s needs and budget.
By securing this policy early, you lock in lower premiums for your child.
This can be a cost-effective way to provide lifelong coverage and financial security for your little one.
Remember that while children’s life insurance can offer benefits, it’s essential to consider your family’s overall financial situation and goals before making a decision.
7) Nationwide Future Life Plan
Nationwide offers a child life insurance policy called the Future Life Plan.
This whole life insurance product provides coverage for children from birth to age 17.
The Future Life Plan allows you to lock in low rates while your child is young.
As your child grows, the policy’s cash value will accumulate over time.
You can choose coverage amounts ranging from $10,000 to $50,000.
The policy comes with a guaranteed insurability option, allowing your child to purchase additional coverage as an adult without a medical exam.
Nationwide’s plan includes a terminal illness rider at no extra cost.
This rider allows early access to a portion of the death benefit if the insured is diagnosed with a terminal illness.
The Future Life Plan offers flexible premium payment options.
You can pay premiums monthly, quarterly, semi-annually, or annually to fit your budget.
As the policyholder, you maintain control of the policy until your child reaches age 21.
At that point, ownership can be transferred to your child if desired.
Nationwide has a strong financial rating and ranks high in customer satisfaction for life insurance.
The company received the second-highest score in J.D. Power’s 2023 U.S. Individual Life Insurance Study.
8) New York Life Starter Insurance
New York Life offers a whole life insurance policy for children called Starter Insurance.
This policy provides lifelong coverage starting from a young age, ensuring your child has protection throughout their life.
Starter Insurance builds cash value over time, which can be a financial resource for your child in the future.
The policy’s premiums are locked in at the child’s current age, making it an affordable option for long-term coverage.
You can choose coverage amounts that fit your family’s needs and budget.
The policy also offers the flexibility to increase coverage as your child grows, without requiring additional medical exams.
One key advantage of New York Life’s Starter Insurance is its potential for future insurability.
This means your child can purchase additional coverage later in life, regardless of their health status.
The policy includes a unique feature called the Insurance Purchase Option.
This allows your child to buy more coverage at specific ages or life events without providing proof of insurability.
New York Life is known for its financial strength and stability, which can provide peace of mind when choosing a long-term insurance policy for your child.
Their extensive experience in the insurance industry adds to the reliability of their products.
9) Aflac Juvenile Life Insurance
Aflac offers juvenile life insurance policies designed to protect your child’s future insurability.
These policies come in two main types: whole life and term life insurance for children.
Aflac’s juvenile whole life policy provides coverage for your child as long as premiums are paid, regardless of future health conditions.
This guaranteed future insurability is one of the most valuable features of the policy.
Your child will be covered until their 25th birthday, provided you keep the premiums current.
This long-term coverage can give you peace of mind about your child’s financial protection.
Aflac allows you to customize coverage options for your child’s policy.
You can choose the amount of coverage that best fits your family’s needs and budget.
By purchasing a policy early, you can lock in low premium rates for your child.
This can result in significant savings over time compared to buying a policy later in life.
Aflac’s juvenile life insurance can also serve as a savings vehicle for your child’s future.
The policy may accumulate cash value over time, which your child can access later in life if needed.
To learn more about Aflac’s juvenile life insurance options and get a personalized quote, you can speak with an Aflac agent.
They can help you understand the policy details and choose the best coverage for your child.
10) MassMutual Whole Life Insurance for Children
MassMutual offers whole life insurance policies for children that provide lifelong coverage and build cash value over time.
These policies can be an effective way to secure your child’s future insurability and create a financial foundation.
You can purchase coverage for children as young as 14 days old up to age 14.
The policy remains in effect for your child’s entire life, as long as premiums are paid.
One key benefit is the guaranteed insurability rider.
This allows your child to purchase additional coverage at specific ages or life events without a medical exam.
The cash value component of MassMutual’s whole life policy grows tax-deferred.
Your child can access this money later in life for various purposes, such as education expenses or a down payment on a home.
MassMutual’s policies also offer the potential to earn dividends, although these are not guaranteed.
Dividends can be used to increase the policy’s cash value or reduce premium payments.
You have flexibility in premium payment options.
You can choose to pay premiums for a set number of years or for your child’s entire life.
Why Life Insurance for Kids Is Important
Life insurance for children offers long-term financial benefits and protection.
It provides a foundation for future financial security, offers cost advantages when started early, and safeguards against unexpected events.
Future Financial Security
A child’s life insurance policy can serve as a valuable financial asset as they grow older.
Many policies build cash value over time, which can be accessed later in life.
This cash value can be used for various purposes, such as:
- Funding college education
- Providing a down payment for a first home
- Starting a business
The cash value can be accessed for any reason while the child is alive.
This flexibility makes it a versatile financial tool for their future.
Starting Early for Lower Premiums
Purchasing life insurance for children often means locking in lower premium rates.
These rates typically remain fixed for the duration of the policy.
By starting early, you can:
- Secure affordable coverage
- Maintain consistent premiums as the child ages
- Potentially save money in the long run
Early enrollment also guarantees future insurability.
This means your child can maintain coverage regardless of health changes later in life.
Financial Protection Against Unexpected Events
While difficult to consider, life insurance for children provides financial protection in worst-case scenarios.
It can cover:
- Funeral expenses
- Outstanding medical bills
- Family counseling costs
This coverage ensures that financial burdens don’t compound emotional distress during difficult times.
Additionally, some policies offer riders or additional benefits.
These may include coverage for critical illnesses or disabilities, providing extra layers of protection for your child’s future.
Types of Life Insurance Policies for Kids
Parents have several options when considering life insurance for their children.
Each policy type offers unique features and benefits to protect a child’s future insurability and potentially provide financial advantages.
Whole Life Insurance
Whole life insurance provides lifelong coverage for children.
This policy type offers a guaranteed death benefit and builds cash value over time.
You can purchase coverage amounts from $5,000 to $50,000 for children as young as 14 days old.
The premiums for whole life policies remain fixed throughout the child’s life.
As the cash value grows, you can borrow against it or withdraw funds for future expenses like education costs.
One advantage of whole life insurance is that it locks in low rates while the child is young and healthy.
This ensures they have coverage as adults, regardless of future health issues.
Term Life Insurance
Term life insurance for children provides coverage for a specific period, typically until the child reaches adulthood.
Some insurers, like Aflac, offer term policies for children aged 14 days to 17 years.
Term policies are generally less expensive than whole life insurance.
They don’t build cash value but offer a death benefit if the unthinkable happens during the policy term.
You can often convert a child’s term policy to a permanent policy when it expires.
This feature ensures continued coverage into adulthood without needing a new medical exam.
Universal Life Insurance
Universal life insurance combines lifetime coverage with flexible premiums and an investment component.
This policy type allows you to adjust premium payments and death benefits as your child’s needs change over time.
The cash value in a universal life policy grows based on current interest rates.
You can use this cash value to pay premiums or withdraw funds for future expenses.
Universal life insurance offers more flexibility than whole life but requires more active management.
It’s important to monitor the policy’s performance to ensure it remains in force as your child grows.
Factors to Consider When Choosing a Policy
Selecting the right life insurance policy for your child requires careful evaluation of several key elements.
These factors will impact both the immediate and long-term benefits of the coverage.
Premium Costs
Premium costs for children’s life insurance vary based on several factors.
The child’s age and health status play a significant role in determining the price.
Generally, younger children qualify for lower premiums.
Payment schedules can affect the overall cost.
Some policies offer the option to pay until the child reaches 65 or 100 years old.
Others allow for shorter payment periods, which may increase monthly costs but reduce the total amount paid over time.
Compare quotes from multiple insurers to find competitive rates.
Remember that locking in a low rate early can provide substantial savings over the policy’s lifetime.
Coverage Amount
Deciding on the appropriate coverage amount depends on your family’s financial situation and goals.
Consider future expenses like education costs or potential medical needs.
Many policies start at $10,000 and can go up to $50,000 or more.
Higher coverage amounts typically result in higher premiums.
Some policies allow you to increase coverage as the child grows older without additional medical underwriting.
This feature can be valuable if you anticipate needing more coverage in the future.
Policy Riders and Add-ons
Riders can enhance your child’s life insurance policy by adding extra benefits.
Common riders include:
- Guaranteed Insurability: Allows purchasing additional coverage at specific ages or life events without a medical exam.
- Waiver of Premium: Waives premiums if the parent becomes disabled or dies.
- Accelerated Death Benefit: Provides early access to benefits if the child becomes terminally ill.
Some insurers offer unique riders, such as college savings benefits or critical illness coverage.
Evaluate these options carefully to determine if they align with your family’s needs.
Keep in mind that adding riders typically increases the policy’s cost.
Balance the potential benefits against the additional expense when making your decision.
Tax Benefits of Life Insurance for Kids
Life insurance for children can offer some tax advantages, though they may be limited compared to other financial products.
The primary tax benefit comes from the policy’s cash value growth.
When you purchase a whole life insurance policy for your child, the cash value grows tax-deferred.
This means you won’t pay taxes on the gains as long as the policy remains in force.
If you decide to surrender the policy, you’ll only owe taxes on the amount that exceeds what you’ve paid in premiums.
This can be advantageous if you’ve held the policy for many years.
Another potential tax benefit relates to the death benefit.
If the policy pays out, the beneficiary typically receives the money tax-free.
This can provide financial protection without additional tax burdens.
Keep in mind that premium payments for children’s life insurance are not tax-deductible.
Unlike some other financial products, you can’t claim these expenses on your tax return.
When considering life insurance for kids, remember that tax benefits are just one factor.
Evaluate the policy’s overall costs and benefits to determine if it aligns with your financial goals.
