Pros and Cons of Buying Life Insurance for Your Kids

Pros and Cons of Buying Life Insurance for Your Kids

The cost of raising a child doesn’t decrease, it only increases.

Knowing it takes so much money to raise a child these days, it makes sense that people don’t want to spend extra money unnecessarily. In fact, frugal living has become something many parents are constantly working toward.

Obviously, it’s a good goal to have. But, to achieve it, parents are cutting their budgets where ever they can in order to save the most money possible.

This makes me wonder where life insurance fits into the picture. Should you buy life insurance for your kids? This is something my parents and I were discussing the other day as they took out insurance on my brother and I when we were little kits.

Here are some of the pros and cons of buying life insurance for your kids.


1. It Can be Inexpensive

You can purchase a term insurance policy for a child for only a few dollars per month. For instance, if you put a rider on your own life insurance policy it may only cost you around $5 to $10 each month.

2. You Will Have Funeral Expense Coverage

Having life insurance is not a guarantee that all of the burial expenses will be paid in full if your child dies. However, when you have a policy you will at least be able to get part of the costs taken of.

3. Coverage Could Last Many Years

Buying whole life insurance instead of term life insurance for your kids means you can have coverage for many years. The downside, though, is that this type of insurance comes at a higher price than term life insurance.


1. Term Insurance Has an End Date

Purchasing term life insurance for your child, although easily affordable for most people, doesn’t mean they will have coverage forever. Term life insurance usually ends when the child is between the ages of 18 and 22 years old.

2. It May be a Waste of Money

It is possible you might pay out on a life insurance policy for your kids and not ever use it. (Not that you’d really want to use it.) Some people would call this a waste of money. They may even suggest you should have put it in a savings account or investment instead.

3. It Can Be Confusing

Trying to decide what type of life insurance you should buy for you kids can be confusing. There are differences in coverage as well as price.

To ensure you are getting the right coverage for your needs, make sure you fully understand the policy before signing any contracts and paying any money.

4. Coverage May Not be Available Later

There is always a chance your child may not be insurable in the future. Although it may not happen often or happen to everyone, it can happen in your family as it did in mine.

My parents purchased life insurance for both my brother and myself when we were babies. When my brother was four years old he was diagnosed with a chronic illness that made him uninsurable.

The life insurance policy my parents purchased for him was a permanent policy and is likely the only one he will ever have. Without it he would have zero coverage.

People of different ages may never agree completely when it comes to money. They may not even agree about whether or not life insurance should be purchased on a child.

If you are trying to make that decision for yourself, however, examine the pros and cons of buying insurance for your kids to help you make a good decision.

Do you have insurance on your kids? Why or why not?

Written By
Sydney White is a Texas-born stay at home mom who enjoys spending time with her family, bargain hunting and, hiking.


  1. Oooh, this is a toughie. I’m not sure I would get life insurance on my kids, in our situation, at least. At that time we’ll be debt-free and able to cover a large expense, God-forbid. However, my grandpa took out life insurance on my mom when she was a child. Apparently he’d paid for a full policy, not a term policy. It was something modest, like $4,000. Well, she passed away at the age of 42 with no life insurance. That policy that her dad purchased lightened our burden significantly. Of course, if we’d been on our debt freedom journey it wouldn’t have been an issue.

    If you can’t cover a funeral expense, it may be a good idea to have a small term just in case.

    1. I do agree that it can depend on the situation. Thinking about it while writing this post, I’m torn about getting a policy on myself even. I don’t have dependents, but I do have debt still. I’m not sure… I might have to do more research on it!

  2. I’d really wish, I had sign a life insurance _before_ I was treated because of my depressions. Now no insurance company will make a deal with me.
    And I was 20 years old when I first met the psychiatrist.
    In Germany term life insurance does not end.

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