Should I buy life insurance for my children?

5 benefits of coverage for kids

In the day-to-day hustle of being a parent, life insurance for your children may not top the list. However, life insurance for your kids is not just about peace of mind in the event of a tragedy. It also helps establish a financial and insurance foundation for their future.

No one can predict the future, and one of the most critical benefits of securing life insurance for your children is that it can protect their insurability for life. Here are five reasons to consider purchasing life insurance plans for your kids.

1. Insurability
 One of the primary reasons to purchase life insurance for your kids is to secure their future insurability. By purchasing life insurance early on, you can ensure your child will have life insurance protection as an adult, regardless of any potential health issues that may arise. Certain plans also offer guaranteed options (available at extra cost) for purchasing additional insurance coverage at specific ages without the need for medical questions.

   
   
2. Affordability
 
Life insurance premiums tend to increase with age due to factors like mortality rates. However, parents can lock in lower rates for their children by purchasing permanent life insurance when they’re young and healthy. Some plans even allow for a single premium payment or flexible payment periods. Term life insurance can provide coverage throughout childhood and early adulthood, and options for converting to a permanent plan are available with Modern Woodmen term plans.

   
   
3. Cash value
 
While the primary purpose of permanent life insurance is protection, it also offers the opportunity to accumulate cash value in a tax-advantaged manner. Within certain limits, you can borrow from the plan's cash value to cover emergencies, expenses or other needs. When your child moves into adulthood and takes over ownership of the plan, they retain the same benefit. Starting the insurance early allows the cash value to grow over time. However, it's essential to remember that withdrawing from the cash value will reduce the death benefit if not repaid, and taxes may apply in certain situations.

   
   
4. Member programs
 
Young members of Modern Woodmen have access to various fraternal programs exclusively available to them, including youth service clubs and a college scholarship competition. Additionally, parents can enroll their children in the Birthday Book Club to receive books for their birthdays.
 Learn more about these programs.
   
   
5. Death benefit 
While no parent wants to consider the possibility of losing a child, the financial implications of such a tragedy can be significant. Funeral and burial costs alone can amount to $10,000 or more, not including medical bills and other expenses.¹ Life insurance can help cover these costs and provide financial support for the family during such a challenging time.
   
   

For their future

Providing life insurance for your kids is a prudent financial decision that benefits both parents and children. By securing their future insurability, providing financial protection, and offering opportunities for cash value accumulation and member programs, children’s life insurance offers peace of mind for parents and a valuable asset for children as they grow older.

Every family's situation is unique, and your Modern Woodmen representative can help analyze your needs and provide information about individual plans.

¹ https://time.com/personal-finance/article/how-much-does-the-average-funeral-cost/