Death benefit insurance for child
Although term life insurance is primarily of interest to adults who want to ensure the financial future of their dependents after their own death, there is also the option of purchasing term life insurance for a child.
Basically, in this case, the insurance works the same way as adult term life insurance. Do you want to take out death benefit insurance for your own children under the age of 18? Then you do need to take a number of things into account. You can read more below.
Why do you need to buy death benefit insurance for a child?
Term life insurance in itself brings some interesting benefits to your child. For example, many people think about their children's future and don't want them to get into trouble if one of their parents dies, due to an accident or illness.
The main purpose of term life insurance becomes immediately clear: it gives your child(ren) more financial security, which of course means fewer headaches for you and your partner.
On the other hand, it is also possible to give your child his or her own term life insurance. This is especially interesting since adult term life insurance does not necessarily mean that the policyholder's children are co-insured.
The benefits of having your child's own term life insurance go a long way, as you'll see below:
- You choose the term of the insurance
- The insured amount is free to determine
- You can choose between insurance with a decreasing, constant or increasing insured amount
- Your child accrues a value of his or her own during the term of his or her term life insurance policy
A disadvantage of having your own death benefit insurance for your child then is that you pay an additional premium in your child's name.
Can you take out life insurance for a child under 18?
As already mentioned, adult life insurance does not necessarily include co-insurance for children. Fortunately, it is possible to take out one for your child if he or she is under 18. This is specifically a special children's coverage, which is part of your own insurance.
Here are a few more points of interest if you are taking out life insurance for your child:
1. Pay attention to the maximum age for insurance
In the case of a children's life insurance policy, usually the benefit becomes available to the parents if that child dies before a certain age. Usually, that age is 18.
2. Co-insuring multiple children
In addition, you have the option of insuring multiple children with your term life insurance. This way you immediately insure all children in your family who are younger than 18 years old.
3. Capturing the benefit
Finally, when you take out death benefit insurance for your child, you should determine the amount of money you will receive after your child's death. This money can then be used to pay for the funeral, for example.
4. The insurer's maximum amount
Finally, it is not a bad idea to consider the maximum benefits at different insurers. After all, the amount of coverage varies quite a bit from provider to provider.
A final important point to note about death benefit insurance for your child is that the insurer does not pay out the cash amount anyway. After all, this is only true if your child dies during the term of the insurance. Thus, taking out such insurance for your child does offer options and benefits, but it is also linked to certain limitations.