To ensure that your child will be able to get coverage for themselves later in life, the best thing you can do is purchase a policy for them right now.
Jason McLeod from Alfa Insurance explains:
“Buying life insurance for your children is to help plan for their future. Most people don’t realize that you pay for life insurance with your money but you buy it with your health. What this means is that a person’s health will ultimately decide whether or not they are eligible for life insurance and in most cases we are never as healthy as we are when we are young. This is all the more reason to consider buying life insurance sooner rather than later, because you never know when you could develop a health condition such as cancer, seizures, heart conditions or insulin dependent diabetes, all of which could keep a person from getting life insurance.”
This means that your teen may find it difficult or even impossible to get coverage to provide for their own families by the time they start shopping around for a policy.
But in order to ensure that they are covered when they’re older, you first need to know about the different ways to purchase a policy.
Ways to get your teen covered:
Riders: “A child’s rider is an attachment to one of the parent’s life insurance policies which will provide coverage for the child. The downside to a rider is that the coverage is usually limited to smaller amounts and in most cases the coverage will expire around the child’s 25th birthday.” Riders are sufficient if you’re looking to provide coverage to cover costs should the unthinkable happen.
Stand-alone policies: “A stand-alone policy could either be a term policy or a whole life policy. I personally recommend whole life policies to my clients with children because the premium is usually very affordable and will not increase. So basically, if a parent bought a whole life policy for their 16 year old the rate would be the same even at age 50.” So if you’re looking for a policy for your teen that will cover them into their golden years, a stand-alone policy is your best choice.
As Jason says, “The most important thing to remember about life insurance is that the best type of life policy is the one that’s in-force,” so make sure that your teen retains their policy throughout their lifetime. Jason recommends holding on to the policy until your teen is old enough to appreciate the importance of having life insurance.
Give it to them as a wedding gift or when they have their first child and are more likely to appreciate what they have been given. — Greg, father of 11th grade boy
Factors that can affect insurability:
1. Adverse Medical Condition such as juvenile diabetes, depression, obesity
2. Drug & Tobacco use
3. Career and Hobby choices such as piloting, scuba diving and extreme sports
4. A not-so-healthy family history such as a parent or family member dying of cancer or heart
disease at an earlier age