When most adults hear the term, "life insurance", they think of elderly people and their own insurance needs. But for some people, the first thing that comes to mind is their children.
Parents know they need life insurance in order to protect their kids if something ever happens to them. More so, there are many parents in Canada who choose to buy life insurance for their young children.
That's right - children need life insurance, too. There are many benefits of investing in life insurance for children which can do a lot of good for both the children themselves and their guardians.
Not so sure of this?
Here are 5 reasons you should invest in life insurance for your little one(s).
1. It Lets You Take Advantage of Affordable Premiums
The general rule of thumb when buying life insurance is that the sooner you purchase a policy, the better your premiums will be. This is even truer when you're buying life insurance for your children.
Having life insurance from an early age allows your children to enjoy a "locked in" premium. You don't have to worry about this rate becoming more expensive as they get older. Once they reach an appropriate age, they can then take on the responsibility of paying for it and taking care of their insurance needs.
2. It Ensures Your Child Qualifies for Additional Insurance
As nice as it is to save money on insurance premiums, it's even better to save on medical expenses. In the unfortunate event that your child contracts a life-threatening condition, you'll need to find the best use of every single dollar you have access to. A child life insurance policy helps with that.
This is because a pre-existing insurance policy helps children have a better chance of qualifying for additional insurance, regardless of their current state of health. Without any life insurance, a child may be barred from getting life insurance if they have a life-threatening condition.
3. It Helps Cover Funeral Costs
This reason to get life insurance for a child is arguably the hardest one to come to terms with. It's one thing to have hope during your little one's treatment process as they fight whatever condition they've been diagnosed with, but it's a completely different thing to have a young child pass away.
The last thing a parent wants to deal with as they're mourning a child is stressing over finances. Thankfully, many child life insurance policies can help cover funeral costs and any remaining debt for medical expenses.
There are more important things to put your energy toward during this time than paying bills and handling personal finances. Having a life insurance policy for your child can help you do what you need to take care of yourself and other members of your family, while also helping you maintain a good financial standing.
4. It Can Turn Into a Savings Account for Your Child
Here's the bright side of investing in a life insurance policy: maybe your child pulls through the condition they were diagnosed with, or maybe they never contract a life-threatening disease. In both of these scenarios, having a life insurance policy means your son or daughter can cash in on their policy when they get older.
Your investment in insurance can then turn into extra funding for something like college expenses, a new insurance policy, or even personal finances. The only catch is the access that your child has to the investments you've made depend on the policy you purchase.
As such, you need to take your time to compare all the different insurance policies available to you as parents. This allows you to get the best possible plan to protect your child in case something happens in the near future, while also setting them up for financial success later on in life.
5. It Offers Peace of Mind
The final reason to purchase life insurance for children seems simple enough, but it's actually a lot more important than you might think.
Imagine for a second you would do if your child did have a life-threatening accident or if they were diagnosed with cancer. Would you be financially prepared to handle all the medical expenses such situations come with? Would you be in the right emotional state to come up with financial solutions, or would you prefer to put your energy toward supporting your child and your spouse?
Most parents would rather be there for their family than spend hours on the phone talking to insurance companies and medical providers. But, some end up doing the latter if they don't prepare for the possibility of ending up in this situation.
Although it's a grim thing to think about, it's much better to be prepared and have life insurance for your children than to be caught off guard.
Choosing Among All the Life Insurance for Children Options
Keep in mind it's much different to recognize the need to invest in life insurance for children than it is to find the right life insurance policy for your children. Some parents choose to add children as riders to their own life insurance, while others prefer to invest in a separate life insurance policy for their little ones.
Whatever option you choose, just make sure you don't end up in the group of parents who neglect the importance of having life insurance for children.
For tips on finding different policies and choosing the best one, click here!