What Is Child Life Insurance?
The mere thought of losing a child is enough to make any parent feel sick. Child life insurance is a form of insurance that will pay out should your child become seriously ill and/or die during the policy term. It can give you financial assistance during the most stressful times.
Let’s answer a few of the most common questions you might have about child life insurance 🤔
Do I need child life insurance?
If your child becomes ill or passes away then there is a chance that you'd need to spend a significant time away from work. Insurance for kids could help keep your home functioning with things such as mortgage repayments and bills while you're not able to earn money, or even help with the unfortunate case of funeral costs.
Can I add kids to my life insurance policy?
It’s rare to get a life insurance policy solely for a child. However, there are a few options in doing this though, so let’s look at a few.
What are some of my options?
Rider insurance: It’s more common that you would add a child on to your policy. This makes it easier to control and helps you often have the option of adding critical illness cover.
Term life insurance: Another way of insuring for the loss of a child. This is where you’ll pay into the policy for a set period of time until they reach adulthood. This often means a cheaper premium as the policy will expire once the term ends.
Life assurance: A policy for your child throughout their life. While this can often give you a higher payout, the premiums are usually a lot more expensive which makes it more rare than the other options.
How do I choose the right cover for myself and my family?
You should never dive headfirst into an insurance policy without considering what is right for your specific needs. If you firstly don’t have any life insurance yourself, how about you start there 💛 Take a look at this article, it may help you realise how important life insurance is!
Are you a solo parent or do you have a partner? Who specifically should be covered? Are you planning to have a joint policy and attach a child to it or perhaps going for a sole policy? What type of policy are you looking for? How much payout do you need? How long do you want to pay the premium for? Are you insuring all of your children (or perhaps just the one that has a medical condition, for example)?
It’s important to look at your situation and choose a level of cover that works for you and your loved ones.
What are some of the factors and/or limits of a policy?
All policies will be slightly different and have their terms and conditions on various aspects. One such limit may be how much you can claim on a policy. This can often be capped at a certain level and will be linked in with the monthly cost of your premiums.
Policies will also have age limits, for example, policies that are only available for children 18 and under. The most important conditions, however, may be what constitutes a critical illness. If your child has a condition, then you need to be covered for that specific illness should something happen.
What’s the cost of cover?
The cost of your cover is going to depend on a few factors. Medical history, your age and your child’s age, how much cover you want, the type of cover and how long the cover is for. Also, honesty is the best policy with life insurance as any withheld information (such as a preexisting condition) could invalidate the policy.
What is family life insurance?
Insurance policies may sometimes sound the same but are quite different. Family life insurance is a standard form of insurance that pays out if a parent passes away. It doesn’t pay out if a child passes away unless you specifically ask for a child life insurance element.
Can I put life insurance in trust?
If you’re looking to leave money behind for your children, then you can put it in a trust. This is managed by someone until the trust pays out to the beneficiaries, your children. This can happen upon your death, or in some cases when they reach a certain age, such as 18. It’s also best to make sure your life insurance and trust are both placed in your will. If you have any questions about how this is done with a will, feel free to email our partners James Pearson Estate Planning (JPEP) at @email@example.com.
Protecting the future
Whether you are looking to cover the loss of a child, protect against critical illness or give them financial security after you’re gone, there’s a policy out there for everyone. We currently offer term life cover and are excited to see where our products take us in the future. 🤩