Should I Have a Life Insurance Policy on My Kids?

Living in Las Vegas, NV, there are days when you think of little more than how hot it is. Still, life here is like anywhere, and there are always more responsibilities to be tackled. One of those is getting a  life insurance policy. While you’re shopping, you might wonder if you need coverage for the whole family. That can be a surprisingly deep and complex question, but Sage Insurance Services Inc. has simplified the answer.

Yes, If

Child policies don’t work the same as adult policies. Technically, you can attach a term policy for your child to the one you already have, but it doesn’t usually make sense to do so. Instead, children qualify for whole life insurance. These policies basically work as an additional investment account that will belong to your kid when they hit adulthood.

Whole life policies have guaranteed returns. They won’t set records for how much interest they accrue, but they are zero risk and tax-deferred. That second part is what matters most. If deferring taxes on the money you put into a whole life insurance policy could save you money in taxes, then it’s a reasonable way to set your child up with a nest egg later in life.

The Special Case

Without tax savings, child policies aren’t usually necessary. There are plenty of other ways to put money away. The one exception is for children who develop a lifelong medical condition. Even if the condition isn’t overly serious or life-changing, it could inhibit their ability to purchase life insurance as an adult. If you get them a whole life policy, it locks in their eligibility, and they’ll be guaranteed the right to have life insurance no matter what happens in the future.

Overall, life insurance for children isn’t the first concern for most people, and it doesn’t really have to be. Instead, if your basic insurance needs are met, you can talk to your Sage Insurance Services Inc. representative and see if there are any golden opportunities. Not everything in Vegas has to be a gamble.