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What are the reasons for life insurance on children?
- Thread starter NHB_MMA
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- Staff
- #62
no thats how an insurance agent think....
see.... there you are again....you can not see the forest because of the trees...Its not about income replacement in this case.....whats going to last a life time is the child being taught about life insurance by their parents....
see.... there you are again....you can not see the forest because of the trees...Its not about income replacement in this case.....whats going to last a life time is the child being taught about life insurance by their parents....
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Great point Sti, I think lots of agents lose sales by trying to sell the client what they want to sell them, not what the client wants. Clients will find an agent to sell them what they want to buy.
Who among us would not be pleased if upon marriage our parents had given us a 100,000 WL policy that we could take over for a premium of 45.53 a month??? Said policy, utilizing dividends to PUA's would have a death benefit at age 65 of from 220,000 to 281,000. Yes, I know that dividends are not guaranteed.
Edited by David C. Said policy issued at age 1, male.
Who among us would not be pleased if upon marriage our parents had given us a 100,000 WL policy that we could take over for a premium of 45.53 a month??? Said policy, utilizing dividends to PUA's would have a death benefit at age 65 of from 220,000 to 281,000. Yes, I know that dividends are not guaranteed.
Edited by David C. Said policy issued at age 1, male.
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- Staff
- #64
or even paying the prem. thru the dividends....taboo to use paid up policy's these days....
And what happens when the anticipated "average" return is an actual negative return the year the child needs to pay tuition? Should the kid withdraw less for tuition the next year to make up for the short fall in the ROR? Would the college be on board with reducing the tuition to accommodate the kids market issues?
Not only is funding a child's college though a market/equity position dangerous because of the almost guaranteed ACTUAL declines in the market (and thereby decline in the cash flow for tuition). But if you look at a compounding chart for a growth investment - you will be withdrawing the money right before the account would experience some of the largest increases it can participate in (doubling of money ie.. Rule of 72). That makes a whole lot of sense!
IMHO, parWL will be far more advantageous for the child for reasons that have been listed. In addition, I believe it is superior to use to fund a child's college. This is because, in part, if you use a company that has Non-direct Recognition of loans, the CV will continue to grow as if you had never took the money out for college. MF's do that? - Protected from creditors? - Carry a Net Death Benefit? - Tax free? etc....
Here's a question for you; If you do not find WL worth it to have on a child to protect their insurability because of the statistical improbability of the child facing that problem. Do you/will you not sell term insurance because of it's statistical improbability of the insured ever using/realizing the benefit? (less the 1% of all term policies will ever pay a death benefit)? Just seeing if you are consistent in your premises.
Agent
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Comming from the perspective of an agent who has worked in funeral homes for the last 12-years, I cringe when I hear "experts" say you don't need insurance on your kids.
It's not for future insurability although that's a good feature.
It's not for final expenses...although that's VERY important at the time of the highest grief.
It's because I've never seen parents who lost a child on Wensday who were ready to go back to work on Monday. Many are forced to. And many are emotionally wrecked and need to take some time away but can't.
I've worked with MANY families who really have lost a child. And if they have the LUXURY of not having a financial burden on top of their loss it's a blessing.
Yes, the odds say you won't lose your child at a young age. That's why that kind of insurance is so cheap. I recommend it.
It's not for future insurability although that's a good feature.
It's not for final expenses...although that's VERY important at the time of the highest grief.
It's because I've never seen parents who lost a child on Wensday who were ready to go back to work on Monday. Many are forced to. And many are emotionally wrecked and need to take some time away but can't.
I've worked with MANY families who really have lost a child. And if they have the LUXURY of not having a financial burden on top of their loss it's a blessing.
Yes, the odds say you won't lose your child at a young age. That's why that kind of insurance is so cheap. I recommend it.
- 9,744
Wow, finally some non "emotional" viewpoints, other than the crap that the big life insurance companies hand out (and I worked for two of 'em)!
My hat's off to you. Let's look at them in-depth...
No, not at all. Buy a kiddie rider - and invest the difference. Aren't kiddie riders convertible when the child reaches a certain age?
Life insurance is a great product - as life insurance. As an accumulation vehicle, due to the inherent charges - not so good versus other things you can do.
My hat's off to you. Let's look at them in-depth...
No, not at all. Buy a kiddie rider - and invest the difference. Aren't kiddie riders convertible when the child reaches a certain age?
Life insurance is a great product - as life insurance. As an accumulation vehicle, due to the inherent charges - not so good versus other things you can do.
- Staff
- #68
man.....you are still missing the point.....you might be missing sales for being one sided....just a thought....please tell us what you know about convertible....
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- 9,744
Actually Scott, I started in the biz with life insurance...working a debit with Pru. Have also worked for Guardian, and also did a stint as a life insurance wholesaler.
Even though it's not my main focus, I still write a fair amount of life apps, mainly high face amounts of term insurance - cuz I'm dealing almost exclusively with business owners.
I've delivered a good amount of death claims. Not a single beneficiary (isn't that who it's for?) has ever asked me what type of policy it was. If I had a choice, I'd rather be delivering a $300,000 check from a term policy - than a $75,000 check from a whole life policy.
- Staff
- #70
so did I with mother met.......but this discussion is not about you....it is ...What are the reasons for life insurance on children......your point is.....
now if my client does their job right I will be writing this policy on their kids (but most likely it will be a mill. plus because that is my avg. on adults)...along with a paid up $50,000 WL....most life policy's that are written on young couples are by their parents life agent.....
now if my client does their job right I will be writing this policy on their kids (but most likely it will be a mill. plus because that is my avg. on adults)...along with a paid up $50,000 WL....most life policy's that are written on young couples are by their parents life agent.....
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