As a parent, life insurance may not be the most fun present you’ll ever give your kids. But it’s a building block that may benefit them longer than those stray Lego bricks you step on in the middle of the night.
Life insurance protection provides parents peace of mind – no matter what tomorrow brings. Here are just five more reasons to consider covering your kids.
Perhaps the most important reason to purchase life insurance for a child is to protect future insurability. That means your child is assured life insurance protection as an adult, even if serious health problems develop.
Health conditions can cause someone to have to pay higher rates or even to lose the ability to buy more insurance. Losing insurability is not as common as paying extra premium for health reasons, but everyone runs the risk of it happening.
Some plans also offer guaranteed options to purchase additional insurance at stated ages without medical questions.
Due to increasing mortality and other factors, life insurance premiums get higher as people age. By purchasing permanent life insurance for a young, healthy child, parents can lock in a lower rate that continues throughout the child's life. Some plans allow you to pay off the coverage in a single premium. Or by the time your child goes to college. Or whatever payment period you choose.
With term insurance, you can ensure coverage throughout childhood and into early adulthood for as low as $2.50 a month.* And Modern Woodmen term plans allow you to easily convert to a permanent plan in the future.
Every family situation is unique. Your Modern Woodmen representative can help analyze your needs and offer more information about individual plans.
3. Cash value
While not the primary purpose, permanent life insurance plans offer an additional opportunity to accumulate money in a tax-advantaged way. Within certain limits, your child can borrow from the plan’s cash value later in life. Use that money for emergencies, college or countless other reasons. The earlier your child is insured, the longer that cash value can grow.
Just remember, taking from the cash value will reduce the death benefit if you don’t pay the money back. You might also need to pay taxes in certain situations.
4. Member programs
Young Modern Woodmen members have access to a host of fraternal programs available only to them – from youth service clubs to a college scholarship competition.
Members can also sign their child up to receive books on their birthday through the Birthday Book Club.
5. The death benefit
No parent wants to think about the possibility of outliving a child. But the sad fact is, it happens.
Death – no matter the age of the deceased – can cause financial stress on a family. Funeral and burial costs alone can easily reach $10,000 or more, depending on your desires and where you call home. That doesn't include medical bills and other costs that may accompany the death.
Life insurance can help cover these costs and afford a family time to cope with the emotional stress of losing a child.
For their future
Covering your kids with life insurance isn’t morbid. It’s a mindful step that makes good financial sense … for you now and for your child down the road.
And with that step out of the way, you can clear your mind for more pressing concerns. Like avoiding those Legos on the floor.
*Certificate issued on form ICC19 MYLFT-30 or an applicable state variation. State variations may apply. Converting to a permanent plan is based on the products available at the time of conversion. Product availability may vary by state.
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Additional products and services
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Universal life insurance
Universal life insurance is a kind of permanent life insurance coverage that provides flexible protection and cash accumulation that you can adjust as your needs change.
Birthday Book Club
Modern Woodmen kids who qualify can receive a book in the mail each birthday up to age 16. The high-quality, age-appropriate books include classic tales, contemporary fiction and educational resources.