Every parent hopes their children outlive them and in most cases they do.  However, there are devastating situations in which a parent may lose a child.  The emotional impact, regardless of how much love and support they may receive, is incomprehensible.  Not only would life insurance coverage on a child pay for the cost of a funeral, it will also enable grieving parents to take time off work without facing financial hardship.

How does life insurance on a child work?

You purchase term life insurance to protect your loved ones from financial hardship if you die prematurely.  The life insurance company insuring you likely has the option for you to add on a “child rider” when you purchase.  So, not only will your policy cover your life, it also will provide a death benefit in the case that one of your children passes away.  Also, even though you need a medical exam to get life insurance coverage, your child is underwritten non-medically, so they don’t need to undergo a medical exam.

What is the cost of a child rider?

The cost to add on a child rider to your policy varies between the different life insurance companies, but it tends to be a nominal fee.  You typically pay a cost per unit, with a “unit” being an amount per thousand.

Example:  You purchase a term policy from Company A and want to add on a $10,000 child rider. Company A’s child riders cost $5 per unit ($1,000), so you would pay an additional $50 per year.

Something important to note is that the purchase of a child rider covers all your children.  No matter if you have just one child or seven.  So, in keeping with the previous example, if you do happen to have seven children, you do not need to purchase seven riders, the one will cover each of them with a $10,000 death benefit.

How long does the child rider last?

The coverage ends when your child reaches “age of maturity” and this age varies depending on which life insurance company you ask.  The age range is generally somewhere between 18 and 25.

Another important note is the fact that you are guaranteed the option to convert all or some of the term policy into a permanent policy when the child reaches age of maturity.  There may be limits as to how much coverage you can convert.  As an example, some life insurance companies may only allow you to convert up to 5x the original face amount of the rider.  If we stay with the previously mentioned example, this means you would be able to convert the term policy into a $50,000 permanent policy.

No parent ever wishes to go through the heartache of losing and burying a child, but a child rider will ensure you have the financial flexibility to pay for a funeral and take time off to be with family as you grieve.


Photo credit to: Lisa L Wiedmeier


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