Why do Kids Need Life Insurance? An Analysis of Juvenile Whole Life Policies

As an independent insurance agent, I sell many types of policies. Juvenile whole life policies are often overlooked by both agents and parents. They are very affordable. Premiums start at just a few dollars a week. Therefore, they do not generate big commissions for insurance agents. When a close friend of mine bought a policy for his infant son, we chatted and caught up with each other for about an hour, then did the application itself in under 20 minutes. At the end of that call, he laughed and said, “Well, we’ve talked for over an hour and you made about fifteen bucks, right?”

He wasn’t far off target. But I don’t focus on juvenile whole life for the commission. I focus on them because I believe that they’re one of the most important policies I sell.

Let me tell you why.

Whole life insurance is fairly expensive for older folks. A whole life policy is designed for final expenses. The average cost of end-of-life expenses is approximately $10-15,000. You want to make sure your family doesn’t have to pay those costs when you die. These policies are expensive because the insurance company knows that they will eventually pay the death benefit. If the death benefit is $20,000, whenever you die, your beneficiary will receive $20,000. If you are over 40, no matter what you hear from those catchy ads on TV, your price for whole life is not cheap.

With a term life policy, your beneficiary receives the death benefit only if you die within the timeframe established by the policy. For instance, if you are a healthy 35-year-old man and buy a 20-year, $200,000 policy, the insurance company knows you are likely to live to see age 55. Therefore, that policy is relatively inexpensive. It’s designed to replace at least 1-3 years of your salary if you die during your highest-earning years. Therefore, it’s not just for that funeral and memorial service. It’s to pay the mortgage and send your kid to college because you won’t be around.

So why the heck would you buy an 18-month-old toddler a whole life policy?

1.) It’s very inexpensive.

$10,000-$20,000 of whole life coverage normally costs just 5-7 dollars/month. If you can splurge for a Big Mac or a cold, refreshing beer once a month, you can make sure your child will never have to worry about life insurance when she’s older. Better yet, she’ll still be paying $6.00/month as long as she lives. She’ll never have to make that calculation of whether she should leave a job she hates or stay just to keep her life insurance policy. She’ll hold her own policy, in addition to anything she has through her employer.

2.) It builds cash value

Let’s say your daughter lands a job she loves right out of college, does extremely well, and has great insurance coverage through her employer. The cash value of that life insurance policy you got for her when she was 3-years-old won’t be enough to buy a house. But it might help with the down payment. When your child is in her 20s, she can choose whether she wants to keep her life insurance or cash it in. 

3.) It protects against future uninsurability

Many of us develop conditions that make it difficult to get insurance later in life. If you get a whole life policy while your child is young, you can make sure that she will always have life insurance at an affordable price.

4.) The worst case scenario

It pains me to write these words as a father because even the thought of losing a child is enough to rip my heart in half. But I know the statistics. It is unthinkable to imagine a parent burying a child. It’s supposed to be the other way around.

But it happens. My local bar in college often had a jar out to raise money for loyal regulars or staff members who experienced unimaginable tragedy. That jar at the bar has since moved to an online platform.

It breaks my heart when I see those “Go Fund Me” pages on my Facebook newsfeed. Because just like the jar at the bar, there will never be enough money inside to cover the cost of a memorial service and any uncovered health care bills.

I prefer to focus on the first three reasons to buy juvenile life insurance. The fourth is not likely but it must be listed. You don’t want to have to hold out an online jar and ask for money when your heart is breaking.

In conclusion, for just a few dollars a month, you can give your child a great gift for her future. It was the first policy I wrote as a licensed agent for my own daughter, and one that I always advocate buying when I speak with potential clients. If you are a parent and do not presently have whole life insurance for your child, I can set a policy up for you and give you peace of mind.

Serving my clients’ needs is more important to me than commission. Other agents might make these policies an afterthought. I put them front and center. Give me a shout if you would like to learn more.



Rudolph Lurz is a former teacher and football coach with over a decade of experience in education and a doctorate in Administrative & Policy Studies. His insurance firm offers options from numerous national carriers such as AFLAC, AIG, Americo, Mutual of Omaha, John Hancock, Foresters, Prosperity Life and Athene Annuities. He is licensed and insured in Virginia, West Virginia, Pennsylvania, Illinois, and Florida (and can provide referrals for customers in other states). He focuses primarily on life insurance, supplemental health insurance, disability insurance, and annuities. He lives in Roanoke, VA with his wife, daughter, and cat.

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