Life Insurance for Children
Life Insurance for a child’s life can be a delicate subject, but can make financial sense, depending on your families financial situation. Insuring a child at a young age guarantees that he or she has insurance now and has the ability to get insurance in the future.
As parents, we would do anything for our kids, but what if the medical expenses were already taken care of and we could concentrate on being our child's soft place to fall?
In the article A detailed look at Canadian Insurance Companies you will find a comparison of three Canada's leading Whole Life insurance carriers for children. For more information on whole life insurance for children, please contact us at 1-866-899-4849 or visit our online Whole Life Insurance Instant Quote Page.
If you are interested in more articles on Life insurance for children, see the articles below!
More articles about Life Insurance for Children
When it sounds too good to be true, it usually is. But this time, with the help of Foresters' FamilyLife Whole Life Insurance Policy, it can be a reality for your child.
The average commission generated by a life insurance policy varies depending on the type of life insurance in question.
According to Statistics Canada, there are more than 350,000 children born in Canada every year.
According to CBC, "Between 1994 and 2005, rates of high blood pressure among Canadians skyrocketed by 77 per cent, while diabetes rose by 45 per cent and obesity by 18 per cent." Further, "More than 250,000 Canadians in their 20s and 30s had high blood pressure, making them the newest at-risk group."
Most parents looking for life insurance for their children are looking for permanent policies where the coverage remains level for the insured child's lifetime.
BMO insurance offers a 20-pay non-participating whole life plan for children.
Which type of Life Insurance policy is best for your child? This is a tricky but important question. Let's break the answer down into three categories.
A Children's Life Insurance policy can be a great way to protect your child's future insurability, and it offers some valuable benefits.
The Globe and Mail wrote an interesting article exactly a year ago, in October 2011, asking "Does your child need life insurance?"
BMO Insurance offers the following four policies directly to consumers through its website.
As of July 23, Assumption Life announced they will no longer carry Odyssey Universal Life, Whole Life and Whole Life Junior, T-10 term life insurance and Guaranteed Economic Life. The reason behind the decision has to do with the fact that all of their other products are integrated into their online application system and these ones are not.
Life insurance premiums can be pretty expensive even though they're one of the most worthwhile investments you can make for the future of your family. Luckily, LSM is sharing the tricks of the trade, which will allow you to still protect your family without sending yourself to the poorhouse.
Industrial Alliance has several unique products and features within its life and living benefit insurance lineup. The following are eight key benefits that help separate Industrial Alliance from its competitors:
Industrial Alliance offers a child life and health dual policy, which provides insured people age 0 to 20 with a combination of life insurance and critical illness insurance coverage.
Faith Life Financial offers the following two participating whole life policies:
Assumption Life introduced a children's term life policy called Youth Plus.
Assumption Life recently introduced Youth Plus. It is a term life insurance product designed for children. The policy is available to insure children between 15 days old and 17 years of age. The features on the policy include the following:
Empire Life offers renewable and convertible Term policies as well as Non-Participating Whole Life policies and Universal Life plans.
So something has happened to you or your family, but thank goodness, you have insurance, and now it's time to file a claim. But how is that done exactly? What do you need to do to prepare?Don't stress! We'll show you...
LSM Insurance has been providing life insurance solutions to Canadians for just under 20 years.
Most life insurance companies in Canada allow the insured to add riders to their life insurance policies. Adding a rider to a policy versus taking out a separate policy can mean substantial savings for the insured.
Canada Life increased rates on its Universal Life Level Cost of Insurance, and Limited Cost of Insurance policies, as of February 7, 2011.
RBC Insurance's Universal Life policy is available with a level or increased cost of insurance. Both versions have a Children's Term Rider, which is available to children ages 14 days to 20 years. Benefit amounts are $5,000 to $30,000 per child. The premium for the rider does not change when additional children are added.
Eileen McGeough bought life insurance for her two children after her neighbour's teenage son was killed in a car accident almost 20 years ago. The sudden death and watching the family struggle in the aftermath left McGeough feeling vulnerable. At the time, the young mother knew she wouldn't have the money on hand to bury one of her own children. For $15 a month per child, life insurance gave her some peace of mind.
"You don't think about these things until something happens," says Caledon, Ont.-based McGeough. "I just got scared and thought, God forbid, should anything happen it would be one less thing you'd have to deal with."
"People used to use it as an education fund, but it's less likely these days," says Lorne S. Marr, founder of LSM Insurance in Markham, Ont. With the introduction of the Canadian Education Savings Grant in 1998, which matched 20 per cent of a family's contribution to a Registered Education Savings Plan (RESP), the popularity of child life insurance waned.
Insurance offer round the clock coverage
This type of insurance not only covers accidents that happen at school, but anytime anywhere, even during summer holiday. Coverage is 24/7.
"It's a fairly niche product and there are not a lot of companies that offer it in Canada," says Lorne S. Marr, founder of LSM Insurance in Markham, Ont. "It tends to be sold through direct marketing and there is not a lot of broker networking involved."
Most programs in Canada are underwritten by Vancouver-based Industrial Alliance Pacific (IAP) and Hamilton, Ont.-based Reliable Life Insurance.
Reliable Life Insurance operates the parent-friendly website, InsureMyKids.com, where families can choose from a variety of plans -- Bronze, Gold, Silver and Platinum. The IAP Kids Plus program includes the Active Plan, as well as the cost-conscious Value Plan.Continue reading
BMO Insurance offers a children's life insurance plan sold directly via its call center and not its broker network. The plan is called the “Headstart in Life Plan.”
Protecting their children’s future insurability is a priority for many parents.
For most people, a life insurance policy is a way to protect assets or maintain a lifestyle for dependents when the main breadwinner passes away. This makes such policies for children seem unnecessary and even morbid.
But insurance brokers of LSM Insurance, a leading provider of on-line life and health insurance solutions, argues juvenile policies can be a financial "gift" for parents to bestow upon their children, ensuring lifelong coverage at a relatively low price. A Term 20 policy begun when a child is two, for example, will be fully paid by the time the child leaves university, can be upgraded at specific milestones, and means the child is covered even if he or she later develops a serious medical condition.
"It's an added bonus you can do for a child," they say, noting such policies are recommended for parents who are fully insured themselves. "The idea behind it is to get low premiums and protect their insurability," agrees Marie-Claude Poulin, a life insurance product-development analyst at Industrial Alliance. "It is easier to insure someone as a kid than when they are 35."
The cost differential alone can be substantial. A C$100,000 policy on a two-year old is C$290 a year, or C$5,800 over a 20-year term. The same policy on a 25-year-old is C$423 a year, or C$8,460. A 45-year-old would pay C$1,034 a year.
But the biggest advantage is that the policy is in place before any health issues surface, an important consideration in an era in which autism and child diabetes are on the rise. This could also be attractive for families with a hereditary conditions such as cancer and heart disease. Some policies even include a guaranteed insurability rider that allows coverage to be increased by C$300,000 or C$500,000 without evidence of insurability, at any age.
While parents may shy away from the idea of preparing for their child's potential death, accidents and illnesses do happen. In these tragic cases, LSM professionals say, the insurance policy not only helps pay the C$10,000 to C$15,000 cost of a funeral, but the remaining funds could allow the parents to take an extended leave from their jobs to mourn.
"Maybe it gives them six months to get their lives back on track."
Parents also frequently take time off work if a child is struck with a severe illness and needs constant care. In these cases, a relatively new product which combines life insurance and critical-illness insurance is available.
Industrial Alliance launched its "health duo" policy in early 2009, combining a whole life policy with critical illness coverage for a child until age 30. The policy allows parents to withdraw 50% of the face value to pay for expenses, if their child is diagnosed with a critical illness. Later, the critical-illness coverage can be converted to permanent life insurance without proof of insurability. The cost is only slightly higher than a regular juvenile policy, Poulin says, and includes clauses that increase coverage after age 15, if the child is claims-free.
For more details, you can contact us at 1-866-899-4849 or visit our Instant Quote Calculator.
Heaven forbid the unexpected happens: Lung Cancer, Leukemia, Cystic Fibrosis. Critical Illnesses can befall children as well. As parents, we would do anything for our kids, but what if the medical expenses were already taken care of and we could concentrate on being our child's soft place to fall?
Now you can with Desjardin's Harmony New Generation Critical Illness plan for children. The parent [policyholder] receives a lump sum payment that can be used to stay by their child's side. Harmony New Generation also provides a refund of premiums for children that are not diagnosed with a critical illness which can free up funds to help them realize their dreams and aspirations.
The features on the plan include:
No Policy Fees
Permanent plan with ROP and optional death benefit
Premium duration: lifetime or 20 years
Covers 28 or 31 illness
Recovery Cash Advance
Prompt Recovery assistance services, which includes Best Doctors
If your interested in evaluating the finest Critical Illness plans in Canada, check out our free, Critical Illness Instant Quote Page, or call our office at 1-866-899-4849.
Putting a life insurance policy on a child may seem like just something insurance broker parents do to collect an easy commission. After all, they have no dependents and they're expected to out live those that raise them. Not so fast, there is a method in the perceived madness.
The following are 5 reasons why insuring a child can make sense:
1. Allows parents and grandparents to leave a financial legacy to their children and grandchildren
2. Affordable premiums guaranteed for life
3. Policy can be have limited pay periods i.e. Plan can be Paid-up insurance after 20 years
4. Any dividends, under a participating whole life policy can grow tax sheltered within the policy
5. Dividends can be used to increase coverage and cash value and accumulating cash value will allow for future borrowing needs
For more details contact us at 1-866-899-4849, or visit our Whole Life Instant Quote Page.
Insure your kids early,
set them up for life.
Photograph by Lars Plougmann
Whole Life insurance can provide a valuable option for individuals looking for lifetime protection, fixed premiums and a tax sheltered savings component.
Participating Whole Life policies allow the insured to participate in the profits of the insurance company. By taking out a policy on a child, the insurance can benefit in the following three ways:Continue reading
Great West Life has a unique Citical Illness insurance plan for children "Child Oasis". It's designed to provide families with the financial resources necessary to support the recovery and care of a child with a critical condition. It also helps insure their future insurability. Some of the features and optional benefits of the Child Oasis plan are the following:
A lump sum benefit of ranging from $10,000 - $250,000
Coverage for 24 critical conditions, including five exclusive to childhood.
Medical support services and resources from Best Doctors.
A conversion feature at age 25.
A return of premium at expiration (This is an optional benefit rider).
The covered critical illnesses in the Child Oasis plan are the following:
Benign brain tumour
Cerebral Palsy (childhood-related congenital disability)
Congenital heart condition (childhood-related critical health condition)
Coronary artery bypass surgery
Cystic fibrosis (childhood-related congenital genetic disease)
Loss of Limbs
Loss of speech
Major organ failure on waiting list
Major organ transplant
Muscular dystrophy (Childhood-related congenital disability)
Type 1 diabetes mellitus (childhood-related critical health condition)
We would be happy to provide additional details on Great West Life's Critical Illness Programs, along with providing quotes from other leading Critical Illness carriers in Canada. You can also get a free, online quote by visiting our Critical Illness Instant Quote Page, or call us at 1-866-899-4849.
The Novaks, have a sick child - and a growing financial problem by Julie Cazzin
2009 Money Sense
Novaks are living every parent's nightmare. Two years ago, their 11-month-old son Leo fell sick. He suffered for days with what his parents thought was the flu. Then he developed a rash and began to cry in constant pain. For six months, the Novaks ferried Leo from one doctor to another in their hometown of Sudbury, Ont. Nobody could identify his problem.
At their wit's end, the Novaks took Leo to see specialist at the Hospital for Sick Children in Toronto. The doctor's diagnosis knocked the Novak's world into pieces. Leo had an auto-immune disease so rare that only a handful of research has ever seen it. There was no cure. Leo might live for decades, but the progress of his condition was uncertain and he would need constant pain treatments and medication to keep his condition stable. "The diagnosis changed our lives forever." says Grace, 36, a speech therapist at a private school, "What little savings we had disappeared with Leo's diagnosis. We know that from now unit forever there will be the added burden of having to take care of Leo. Wherever I see people who fret because they can't max out their RRSPs, I just shake my head. Our day-on-day worries are so different from that."
The Novaks (whose name we've changed) are relived that Leo's illness seems to be under control and that their out-of-pocket medical expenses have stabilized at about $12,000 a year. But they feel overwhelmed by the financial demands they face. In addition to Leo, 3, they have his older brother, Mitchell, a healthy boy of 7, to rise. After paying tens of thousands of dollars for frequent trips to Sick Kids and other care-giving expenses, they have next to no net worth and only about $8,000 in retirement savings.
If Leo's disease worsens, the financial picture will get much darker. "Transportation, meals, hotels - every time we go to Toronto, the expenses add up," says Henry, 40, a consumer-marketing manager. "We need to know we have the money in our budget in case that happens."
Money got even tighter several months ago when Grace had to take disability leave from her $60,000-a-year job because of a flare-up of her arthritis. "I had a complete meltdown of my own after Leo was diagnosed," she says." I was lucky because had disability insurance with my employer. Even so, we have very little money left over. It's very stressful."
For now, the Novaks are living on $122,400 a year - $90,000 from Henry's job and $32,400 from Grace's disability payments. The disability payments run out in September. At that point, Grace hopes to return to work, but she's worried that a full-time job may not give her time to take Leo to his treatments. To give her the flexibility she needs, Grace is considering opening her own speech-therapy practice and working only part-time. "It's tough to give up the golden handcuffs of a big employer," says Grace. "Rut a full-time job just doesn't give me the flexibility I need to continue caring for Leo."
The Novaks worry about retirement. Neither has a pension at work. Henry has started to wonder if he should seek a job with a company that offers a pension, even if it means taking a cut in pay. But he worries that a cut in pay would mean disaster if Leo suddenly needs more help. "We need to always have cash on hand in case Leo needs more treatments in Toronto" says Henry. "I don't think we can save for both retirement and Leo's needs. I just need, to know how low a salary I can accept to make the witch financially feasible."
The Novaks have less than $2,000 in the bank and (Grace would like to build that cash up to at least $12,000). "We need that financial cushion to feel comfortable," says Grace, "I know we need to save for retirement and for the boys' education, but we also need to be sure the money will be there at a moment's notice should Leo need it. It's our first priority."
Grace grew up in Kingston, Ont., the youngest of three children. She enjoyed her childhood, but suffered a debilitating bout of arthritis in her teens that kept her out of school for months. She regained her health and graduated from Queen's University in 1992. She earned a masters degree in speech therapy two years later. In 1994 she met Henry, a Calgary native who was studying business at Queen's. "We lived together for three years and went to parties, movies and ate out a lot," says Grace. "Those carefree days seem so far away."
After graduation, the couple moved to Toronto and Henry landed a job with a consumer products company. Grace worked with kids as a speech therapist... They married in 1998 and set out to start a family. Mitchell arrived in 2001- but only after an agonizing pregnancy that requited Grace to spend six months in bed. "I had my head in a bucket the whole time," says Grace. "But Mitchell was born healthy. That's all that mattered."
When Mitchell was a year old, Henry found a new job as a marketing manager with a small family firm in Sudbury. Meanwhile, he and Grace tried to have another child. It was not easy. Grace suffered through several miscarriages before getting pregnant with Leo in 2005. She again developed complications and had to spend six months in bed, "My job became secondary," says Grace. "I got minimal sick benefits and we accumulated about $20,000 in debt that we eventually consolidated into our mortgage."
Leo was born on schedule, a seemingly healthy full-term baby. When he was 11 months old, Grace returned to work. But then Leo became ill and the health expenses and time off work started all over again, "Except this time the stress was too much and my own arthritis flared up again after years in remission," says Grace.
Grace went on disability last year. She is now trying to figure out what to do when her payments end in September. If she were to set up her own private practice, she could earn up to $5,000 a year and still have the time she needs to look after Leo. The danger is she may not be able to find disability insurance. If she can't find coverage, and her arthritis were to strike again, her income could disappear. "And we need a second income," says Grace. ''That's money we. need to stay afloat."
After paying thousands of dollars in expenses related to Leo's care, the couple have little buffer left. They still owe $207,000 on (heir $214,000 home, as well as another $3,640 for Henry's student debt, which they hope to pay off next year. Henry's RRSP contains only $8,193 and the boys' RESP, only $4,217. Another $1,500 sits in a savings account.
The Novaks will soon have to shoulder day-care costs for their two boys, which they estimate will be about $10,000 a year for the next two years, beginning in September, when Leo is scheduled to start junior kindergarten. There is also the continuing cost of Leo's treatments, which consist of a mixture of conventional treatments as well as alternative therapies that the Novaks have researched on their own.
Leo goes twice a month to a chiropractor, gets weekly refit treatments for stress reduction, receives several acupuncture treat-men is a year, and goes once a month to a naturopath for advice on nutritional supplements. "I take him to all his appointments," says Grace. ''He's functioning so much better than this time last year. We hope it keeps up."
Both Grace and Henry has purchased $500,000 in term life insurance, but Henry has no long-term disability Insurance at work, "Sometimes, in the middle of the night, I wake up thinking how great it would be to have the security of a good pension and great benefits," says Henry. "It would take such a load off our minds to haw those things taken care of for us. But I just don't know if it would be financially worth it in the long run for me to take a job that offers a lower salary in return for a company pension and better benefits."
What the experts say;
In a crisis such as the Novaks are facing, our experts say it's vital to concentrate on one or two goals. Since the Novaks are clear that their No.1 priority Is looking after Leo, here's what our experts suggest:
Protect their Income. The Novaks' first job must be to protect their incomes to ensure that they have the money they need to look after Leo, Our experts are concerned about what might happen if Grace's arthritis were to grow worse or if Henry were to fall sick. "They were lucky over the past few months that Grace had disability insurance," says Janet Freedman, a certified financial planner in Toronto and author of Hit by tin iceberg, an account of her own struggles after she tell and became a quadriplegic eight years ago. "Otherwise, they would have had piled up thousands of dollars worth of debt"
Since Henry is not covered by disability insurance at work, our experts urge him to buy his own coverage through an insurance broker, "It should be easy for him to qualify if he has no pre-existing condition," say LSM Insurance specialists. However, details matter when it comes to disability insurance. Much depends, for instance, on whether it's you or your employer that pays the premiums. If you pay 100% of the premium either directly or through payroll deductions (as Grace did), any benefits you receive are tax-free, "But if your employer pays even a small portion of your premium, then (he benefits are taxable." says Man. "The best strategy in most cases is to pay the full premium yourself. That way, taxes won't eat into any benefits you receive."
Grace, too, needs to gel some type of disability coverage, but finding that coverage is going to be difficult given her medical history. Our experts agree that the easiest way for her to obtain coverage would be to return to her full-time job. That would mean giving up her dream of becoming self-employed, but Freedman thinks there might be a compromise. Grace could ask her employer about returning to work on a part-time basis, working just enough hours to quality for disability coverage-usually 28 hours a week, "Sometimes employers are willing to be flexible," says Freedman. "But Grace has to ask." If Grace is determined to strike out on her own, Man suggests she ask a broker for a trial quote before making a decision.
Forget about retirement. Freedman thinks it would be disastrous for Henry to give up his high-paying job in return for a lower-paying job with a pension, "Not all company pensions are the same and some defined contribution plans aren't worth the paper they're written on," says Freedman. "The Novaks need to stop focusing on retirement for the moment. If they work until 60 or 65, like most boomers, they will be fine. Right now, though, they need every penny of Henry's income. They can't afford for him to take a pay cut."
If Henry is ready for a move, Freedman suggests he look for a job with a similar salary to his current position, but with gold-plated medical benefits. "The really good medical plans cover acupuncture, chiropractic visits, orthotics, speech therapy and a wide range of other medical treatments," she says, "If he could find a job that would pay him about the same salary, but cover a Jot of his family's $12,000-a-year in medical costs, that would really help the family's finances."
Change their saving vehicle. Freedman suggests the Novaks stop saving in RRSPs and RESPs and instead put their $3,600-a-year in savings into Tax-Free Savings Accounts (TFSAs). These new accounts, which are being introduced on Jan. 1, don't give you a tax deduction on contributions. But, unlike RRSPs, they allow you to withdraw money at any time, free of tax.
"The beauty of a TFSA is that it allows the Novaks the flexibility to take their savings out when they need the money," says Freedman. "If Leo's illness stabilizes for several years, they can use the money for retirement, But if Leo's condition gets worse, they can withdraw the money tomorrow without penalty."
Trim expenses, Freedman says the Novaks should look for relatively pain less ways to save. For instance, when Henry's student loan is paid off, they should immediately redirect what they were paying on his Joan into their TSFA, so they're not templed to spend it Switching to no-fee banking with an ING Direct or President's Choke account could save them a couple of hundred dollars a year. Cutting back on restaurant meals and gifts could put another $1,000 a year into savings.
Freedman knows it's a touchy area, but she suggests the Novaks also examine Leo's $12,000 in health-care costs for potential savings. "They need to ask themselves which medical treatments are really helping Leo and which aren't," she says. "They need to really evaluate what they're paying for and stick with the treatments that are doing him the most good. Sometimes, one acupuncture treatment a week is just as good as two."
Over 4,000 participants are expected to attend the 26th edition of Step Up for the Children with Standard Life, to be held on Saturday, June 14 on Ile Sainte-Hélène at Parc Jean-Drapeau in Montreal. The event will begin at 8:30 a.m. with the 10-km race, followed by the 5-km family walk at 10 a.m.
Event ambassador and Montreal Canadiens defenceman Francis Bouillon and child spokesperson Valérie Bernier will open the walk. It will also be a fun celebration for children, with inflatable games, entertainment and free food for everyone.
"I encourage families to come out and participate. This year, the objective of the Step Up for the Children with Standard Life campaign is to raise over $400,000 in support of the Foundation of Stars. People can register online until Thursday, June 12 or on site on the day of the event," explains Francis Bouillon.