Can You Get Term Life Insurance on a Child?

Many parents consider life insurance as a protection plan for the family and prepare for unexpected things, but regarding Term Life Insurance for Kids, the question still arises: Do I really need it? Is there even a possibility of purchasing Term Life Insurance Policies for my children? Such questions keep on lingering in the minds of most Canadian parents looking to provide their children's future with some security but not committing financially. This dilemma is quite often reported to us here at Canadian LIC by parents who want to protect their children but are not very sure if a term policy is what they need.

In this blog, we walk through the benefits, limitations, and other considerations of getting Term Life Insurance for Kids. Whether you are new to life insurance or have existing coverage for yourself, this guide will help clarify what's possible and whether a term policy for children aligns with your family's financial plans.

What is Term Life Insurance for Kids?

The most common design for Term Life Insurance Policies is actually for adults, and the coverage is for a fixed period of time-for example, 10, 20, or 30 years. This coverage allows a death benefit in case the policyholder dies in that term. Whole life insurance is the more traditional sort of life insurance bought to protect children, but Term Life Insurance is available for minors through some providers or may be added to an already existing policy.

An endorsement for a child rider puts term coverage on your minor children under your existing policy of Term Life Insurance; doing so usually costs less when compared to buying a specific policy. For many Canadians, adding a term coverage rider for children provides their parents with affordable coverage of their future needs.

Why Parents Consider Term Life Insurance for Children

For most parents, the concept of insuring a child can be uncomfortable at first. Isn't life insurance all about replacing lost income? Which, of course, has nothing to do with a child. However, from a practical perspective, the reasons parents take Term Life Insurance are different.

• Future Insurability: A term policy rider for children can ensure they have a baseline of coverage that may be convertible to permanent coverage later in life, even if they develop health issues.
• Affordable Premiums: Term Life Insurance is generally more affordable than whole life insurance. By adding children under your term policy, you secure their coverage at a low cost.
• Peace of Mind: Though rare, accidents or illnesses do occur. Having coverage can help alleviate financial stress in difficult times.
• Setting a Financial Foundation: With conversion options, a term policy rider can later become a foundation for whole life insurance, giving children coverage for life.

How Term Life Insurance for Kids Works: The Rider Option

The most common way to secure Term Life Insurance for Kids is through a child rider on a parent's Term Life Insurance policy. Here's how it typically works:

• Added to an Existing Policy: A rider is added to the parent's Term Life Insurance policy, providing term coverage for the child until they reach a certain age, often around 25.
• Low Additional Cost: Child riders are relatively inexpensive, costing only a few extra dollars a month, which is manageable for most families.
• Conversion Option: Many riders allow for conversion to a standalone permanent policy when the child reaches adulthood, providing lifelong coverage without a new medical exam.
• Multiple Children Covered: A single rider can often cover multiple children, making it a cost-effective option for families.

Many parents find it a practical way to get early coverage for their children without the commitment of whole life insurance. It's flexible and affordable, providing them with a way to get their children started on the path to future insurability.

Comparing Term Life Insurance Quotes: How Much Coverage Do You Need?

When you are researching quotes for Term Life Insurance Quotes for kids, one of the most important factors is trying to determine an appropriate level of coverage. The decision will depend on your purposes and budget. Here is a general breakdown of how much coverage is most popular:

• $10,000 to $20,000: Basic coverage, often used to cover final expenses or serve as a simple security measure.
• $50,000 or More: For parents seeking more substantial coverage, especially with conversion in mind, a higher coverage amount can provide a strong foundation.

It is easy to compare Term Life Insurance Quotes with those offered by Canadian LIC. Use the Internet to check out all the options within your budget and in terms of what you are aiming for. Our advisors will explain what level of coverage would fit your family's financial planning strategy.

Pros and Cons of Term Life Insurance for Kids

When considering Term Life Insurance Policies for children, weighing the pros and cons can help you make an informed decision.

Pros

• Affordability: Adding a child rider is often an affordable way to get coverage without the high cost of a separate policy.
• Flexibility for the Future: Many child riders come with a conversion option, allowing your child to transition to a whole life policy in adulthood.
• Peace of Mind: In the rare case of a tragedy, the financial support from Term Life Insurance can ease the burden on parents.

Cons

• Limited Term Length: Term Life Insurance for Kids, especially through riders, ends once they reach adulthood and isn't designed for lifelong coverage.
• May Not Accumulate Cash Value: Unlike whole life policies, term policies do not build cash value, limiting financial benefits over time.
• Possibility of Needing Additional Coverage: As your child grows and takes on responsibilities, they may require additional coverage that goes beyond a converted term rider.

Real-Life Story: Why Parents Choose Term Life Insurance for Kids

We often come across many parents at Canadian LIC who buy Term Life Insurance Policies with child riders as part of their family's financial planning. Such a client was a young couple who had bought a child rider after the birth of their first child. They appreciated the facility's ability to acquire future insurability without any long-term commitment. With the low additional cost, they could obtain a small policy for each of their two children, providing coverage that can later convert into a permanent form of insurance when the kids are grown.

This made them more assured as they knew that when needed, they have some security that does not charge much with full protection to their children. The best way for them is they can start early before many capture it, building such a foundation where their kids may get help in building.

The End

Term Life Insurance for children can be the most sensible, affordable means of acquiring early coverage while ensuring insurability when they reach maturity. The child rider on your term policy gives you peace of mind while providing a good foundation for the lifelong protection of your kids. At Canadian LIC, we have experienced insurance agents who are trained to make the best recommendations to suit your family's needs in customized Term Life Insurance coverage and uncomplicated Term Life Insurance Quotes.

Considering you need Term Life Insurance to protect your children, consult a Canadian LIC today. All our advisors have vast experiences and will help guide through each option, leading your family to the best step for its future. Cover your family at affordable premiums with the best brokerage.

FAQs: Term Life Insurance for Kids

Can I get a standalone Term Life Insurance policy for my child?

Most Term Life Insurance for Kids is offered as a rider on a parent's policy rather than as a standalone policy. However, some providers may offer limited options, so consult with Canadian LIC to explore what's available.

What is the typical cost of a child rider on a term policy?

Child riders are generally affordable, often costing less than $5 a month for a moderate amount of coverage. Our advisors can help you get an accurate Term Life Insurance quote.

At what age does Term Life Insurance for Kids through a rider end?

Most child riders end when the child reaches 25, though this varies by provider. At Canadian LIC, we can provide details on different providers' age limits.

Can a term policy for kids be converted to permanent insurance later?

Yes, many child riders offer the option to convert to permanent insurance without a medical exam, allowing children to retain lifelong coverage.

Is it better to buy term or whole life insurance for children?

This depends on your financial goals. Term policies with riders are affordable and flexible, while whole life insurance builds cash value and is a long-term asset.