Life insurance for children

The arguments that don't hold up

• "It's an investment for their future" — cash value in a small child policy accumulates slowly, and dedicated savings vehicles generally do this better
• "It locks in a low rate" — true, but the amounts are small and rates for a healthy young adult buying their own coverage are already low
• "They'll thank you later" — usually they'd rather have had the money invested elsewhere

The argument that does

Future insurability. If a child develops a serious health condition, buying life insurance as an adult may become expensive or unavailable. A policy bought young, particularly one with a guaranteed insurability rider, preserves the ability to have coverage regardless of what happens to their health.

That's genuine, and it's the reason worth considering. Whether it justifies the cost depends on your family history and what else you'd do with the money.

The other real one: final expenses

Nobody wants to think about it. But families who lose a child face immediate costs and often need time away from work, and a small policy covers that without a fundraiser.

Many employer group plans include a small amount of child coverage very cheaply as a rider. That's frequently the sensible way to address this rather than a standalone policy.

Before you buy a standalone policy

• Are both parents adequately insured first? That matters far more.
• Does your employer plan include a child rider already?
• Would a rider on your own policy be cheaper than a standalone one?
• Is there family history making future insurability a real concern?
• Would the same money do more in a dedicated savings or education account?