That’s right. Life insurance isn’t just for those approaching mid-life anymore. Life insurance for newborns is actually a thing, and not a bad one at that. Life insurance for infants primarily serves to provide financial security and peace of mind to the parents or guardians. Let us discuss some some key benefits:
1. As with any life insurance policy it ultimately provides financial protection. In the unfortunate event of the child’s death, life insurance can help cover funeral and other related expenses.
2. Unique to earlier purchased life insurance policies is the guaranteed of insurability. Purchasing life insurance for a newborn ensures that the child will have life insurance coverage regardless of any future health conditions that may arise. This is particularly important if there is a family history of medical issues.
3. Life insurance policies for infants as the benefit of cash value accumulation. Certain types of life insurance policies, such as whole life insurance, can accumulate cash value over time. This can be borrowed against or withdrawn for future needs, such as education expenses.
4. Life insurances on babies are quoted with lower premiums. Life insurance premiums are generally lower when the insured is younger. Purchasing a policy for a newborn can lock in these lower rates for the duration of the policy.
5. In a broader spectrum life insurance plays a part in financial planning. Some parents or guardians view life insurance as part of a long term financial planning strategy, ensuring that the child has a financial foundation as they grow older.
It’s important to evaluate the specific needs and financial situation of your family when considering life insurance for a newborn or child. Consulting with a financial advisor or insurance professional can help you make an informed decision. We are here to answer any policy questions you may have. As a family orientated business, owned by a father of two, planning for the future is something we love assisting our clients with.
