Stand Alone Child Life Policies

[WinoBlues]

Just got a piece from AARP on their Grandparent child policy. $5. for $10,000 or $10. for $20,000 up to age 17. Those are good rates at the older ages.

 

[term2u]

I'm curious to know everyone's take on these stand alone child policies, as I have a client whose father took out 4 10-pay WL policies through OneAmerica for each of her children (his grandchildren). The children range anywhere from 2-10yrs old.

At this point, the grandfather has paid the roughly $1k premium per year on all 4 policies ($4k total per year) for the first couple of years, and now she's getting the bills for the remaining 8 years. She doesn't quite understand as to why she would continue course with these WL policies, as 1) they're very expensive and 2) she'd was thinking that she'd rather just put the funds in a 529 plan for each of them and add a child rider onto her term policy.

I seem to agree with her, but I'd like to know your thoughts? Thanks in advance!

 

[DHK]

Where is the original agent who sold these policies and how did you get into the picture?

Why isn't the grandfather continuing to fund these policies that he started?

Why do you (or she) think they are expensive? Is this an analysis of the internal costs... or just because she thinks $1k per year for each child for "life insurance" is expensive?

A 529 plan + term rider is simply buying term and saving the difference with market risks. These WL policies are permanent protection that will (most likely) have the GIO rider to increase total insurance coverage at various points of these children's lives without proving evidence of insurability.

If you think that market risk savings is the way to do, I'd suggest reading this article carefully:
Doing right by clients in volatile markets: 3 examples | LifeHealthPro

 

[Gooner]

Where is the original agent who sold these policies and how did you get into the picture?

Why isn't the grandfather continuing to fund these policies that he started?

Why do you (or she) think they are expensive? Is this an analysis of the internal costs... or just because she thinks $1k per year for each child for "life insurance" is expensive?

A 529 plan + term rider is simply buying term and saving the difference with market risks. These WL policies are permanent protection that will (most likely) have the GIO rider to increase total insurance coverage at various points of these children's lives without proving evidence of insurability.

If you think that market risk savings is the way to do, I'd suggest reading this article carefully:
Doing right by clients in volatile markets: 3 examples | LifeHealthPro

What a bunch of garbage that article is. Great read for an arm chair quarterback, I guess.

Oh yeah, drinking coffee gives you cancer, so does drinking milk, orange juice...don't drink artificial sweetners or too many processed foods.

I guess with the internet, we can all find an article or 2 to justify ourselves.

 

[KaseyNM]

Other than that, insuring a child is insuring a financial liability. It's stupid. While the death of a child will cost you a funeral, you don't have to feed and clothe them anymore, you are financially ahead.

What?? You seriously have to be able to see further than the cost savings on school supplies here, right?
Ever think maybe the parents are a wee bit on the sad side after losing a child? Maybe it affects their work performance, maybe they take some time off...


And I view is more as insuring the kids potential. Its a gift a parent can give a child. That way in 20-some years that (now adult) child won't be sitting in my office listening to me explain that I can't get them the million dollar policy they want because of their diabetes, or their kidney transplant.


In order for a kid policy to be good, there has to be multiple APB opportunities. (IMO)