Life insurance on a child
[social_share]Insuring a child’s life is not seen as something that is often done, but as life expectancy grows then retired parents are often finding that they are at least partially reliant on their children and that life insurance may be a good idea.
There are two ways in which many parents can find themselves dependent on their children, and that is either for care or at times they may depend on their children if there are inadequate savings and there are financial emergencies. Many children are prepared to do this in order not to see the family wealth dissipated through reverse mortgages or care home costs.
It may be the case that there are other children who can take on these tasks. In these cases life insurance may not be required. However other members of the family may be less able to support their parents either financially or by caring for them. These decisions should be discussed through the family as a whole. It may be a rather delicate conversation as it involves the state of the parents and the mortality of a child.
Term insurance is usually the best type of insurance in these circumstances. It will usually be very cheap to insure the life of a person in the twenties, thirties or forties – particularly if there is no previous medical condition.
It is usually a better idea to shop around for insurance rather than automatically going to the bank that is usually used or an insurance company that is currently offering some other life insurance. In this way the best deal can be worked out with the lowest premiums for the needed pay out. If there is a family insurance broker then they are usually a good place to start looking for good deals, backed up by the internet.
Parents are a growing market for this type of health insurance. However it is not simply parents who should be looking at this. Many parents actually have the wealth to look after themselves financially or pay for care but to do so would involve tapping into their wealth, which they will not do in order to pass this wealth on to their children or grandchildren.
In some cases the purpose of the life insurance is because the parents have become dependent on their children, although not in the same way as a stay at home spouse or children would be. In other cases it is to preserve the family wealth. The purpose should inform who is paying for the insurance.
