What many people think about life insurance, they usually don’t think of children? Most people think that life insurance is something for adults. This is because many adults take out life insurance in order to protect their families in case of their early demise. However, there are a number of companies, especially in Canada, that are geared towards providing life insurance for children. Just as many people prefer to make sure that their children are properly prepared for school, there are parents that consider the financial stability of their children and want to make sure that they are okay in the future. In order to do this, some parents seek out life insurance for children. A number of popular Canadian life insurance companies such as Canada Life, BMO Life and Assumption Life all provide life insurance for children at various rates. Those parents that want to know for sure that their children are protected in the future should seriously consider obtaining some form of life insurance for their children.
Why do Children Need Life Insurance?
Even though insurance companies promote life insurance for children through television commercials and pamphlets, not everyone is really sure why children need life insurance. In fact, many financial professionals are split on whether or not life insurance for children is even needed. Those that support the need for children to have some form of life insurance state that it is a way for parents to ensure that their children are properly protected. Since parents have no idea what could happen to them over the course of their children’s lives, having an insurance policy in place for the children is something that is seen as being very security minded. However, there are other financial professionals that believe that life insurance for children in not necessary. It should be noted that some parents that know they have a terminal disease will take out life insurance for their children so that they know their child will be taken care of financially in the future. Ultimately, the decision to obtain life insurance coverage for children is based on the parents’ desire to make sure children are protected financially in the future.
Type of Life Insurance Coverage
When considering life insurance for children, there are several options available. The three main options for life insurance coverage for children include term, whole and universal life insurance. Term life insurance provides coverage at a fixed rate for a certain time period. For example, a parent can purchase life insurance for their children at a term of 25 years. During these 25 years, the parent will pay a fixed rate per month. Whole life insurance is highly preferred by some parents for life insurance for children. This particular type of life insurance covers a child for the duration of their life. With this type of insurance that parent pays a fixed amount usually annually, but this can vary. As long as the premiums are paid, the child will receive coverage for the duration of their life. Finally, there is universal life insurance. This type of life insurance for children is considered to be the most comprehensive of all the insurance that is available. It not only provides insurance coverage for the life of the child but it also has an investment account attached to it which allows the insurance policy to increase in value. No matter which type of life insurance for children is decided upon, it is important that parents really consider which type of coverage they would like their children to have.
Life insurance for children is a very effective way to make sure that youngsters have a firm base of financial security in the future.