Life Insurances on Kids

[dlvhi]

Re: Life Insurances on Kids.

What companies have the best policies for kids? I know everybody has heard of "Gerber" but they don't let agents sell those plans.


I was thinking of marketing to parents and grandparents around Christmas time this year and would like a decent product to promote.

I have 2 Pac Life policies on my boys and just got a North American policy on my youngest (a girl).

All IULs.

The primary purpose was to guarantee insurability, but I like the savings component. I had alwalys intended to put $100 a month into a mutual fund for each but never got around to it and didn't want to mess with the tax reporting.

2 years into the Pac Life I still feel real good about the policies, I get quarterly statements showing all the costs, interest earned within the policy, everything. I can also check anytime on-line.

For this last policy I also liked the Lincoln Benefit, looked at Minnesota life, but NA seemed the best fit.

 

[HarryRenard]

I would like to see an illustration from one of the WL Big Boys, It would be for a 4yr (f) for 300k.
If you are licensed in Md that would be great too (I will give you the case). Feel free to illustrate the policy how you prefer.

You can PM if you'd like.

Thanks

 

[somarco]

Humana's HFPP line includes a juvenile plan (Jr Estate Builder) that is competitive with Gerber.

$35/yr for $15k; $45 for $20k.

 

[nycagent]

Re: Life Insurances on Kids.

A lifetime payment policy is NEVER a gift.

It depends on what you mean by 'lifetime payment policy' - if you mean a GUL or something that has no CV, then yes. But I think the best policy juvenile policy is a paid up at 65 - and here's why:

You are giving them the gift of disciplined savings and compound interest. Especially in today's world, when so many parents and grandparents see how woeful most people are about savings, a policy that encourages them to save in a disciplined fashion with a long term focus is a great lesson. Plus, if you take out the policy when they are young, all the 'hard work' on the policy has been done, and the IRR's have reached their max value, so you are getting tremendous return on each premium dollar.

And of course, if for whatever reason neither you nor the child is able to pay the premiums, by the time they graduate you can always turn it into a fully paid up at that point, so it's not like money down the drain.

 

[LGilmore]

what hasn't been mentioned here is a rider that is very important..a guaranteed insurability rider for future purchases.

That way this policy doesn't have to be the only policy a kid could ever get.

With roughly 40% of the population destined to have health problems down the road that could lead to insurability issues, it is nice to take the "no" out of the situation.

Usually only a few dollars a month, something to be considered.

 

[WinoBlues]

what hasn't been mentioned here is a rider that is very important..a guaranteed insurability rider for future purchases.

That way this policy doesn't have to be the only policy a kid could ever get.

With roughly 40% of the population destined to have health problems down the road that could lead to insurability issues, it is nice to take the "no" out of the situation.

Usually only a few dollars a month, something to be considered.

Good point.

Also, convertible Child Riders. Usually can convert up 5 times face. Has been a real life saver for some clients. Also nice little freebie business.

 

[Cornelius]

This price link Dignity Planning is from a Dignity Planning post Dignity Planning

Type in zip code and hit the Choose A plan link to see prices..

I was looking at some of the prices and I can see how just from a financial stand point it could be a major stress for a family. Then to have to worry about maybe having to go back to work?

This is a good eye opening post.

 

[Newby]

Re: Life Insurances on Kids.

It depends on what you mean by 'lifetime payment policy' - if you mean a GUL or something that has no CV, then yes. But I think the best policy juvenile policy is a paid up at 65 -.

I disagree. If you give your 21 year old grandson a gift of a paid up whole life policy you have given him a gift. He can keep it, cash it out, borrow against it or anything he wants.
If you give him a pay to 65 UL you have given him a payment book that he doesn't necessarily want. Plus it's UL which means he has to babysit it and stay on top of it and figure it out to even understand it and keep it from lapsing.
And going RPU does NOT recoup your premium investment. Unless of course you RPU a UL with only a limited age guarantee and plan to die young.
- - - - - - - - - - - - - - - - - -
I'm proud of you son! I bought you this new corvette! Here is your payment book.

Just making a point.

 

[Darras-Law]

I think life insurance is important and you did a great job. At the same health insurance and long-term saving alongwith is best.

 

[Larry Tew]

Re: Life Insurances on Kids.

I disagree. If you give your 21 year old grandson a gift of a paid up whole life policy you have given him a gift. He can keep it, cash it out, borrow against it or anything he wants.
If you give him a pay to 65 UL you have given him a payment book that he doesn't necessarily want. Plus it's UL which means he has to babysit it and stay on top of it and figure it out to even understand it and keep it from lapsing.
And going RPU does NOT recoup your premium investment. Unless of course you RPU a UL with only a limited age guarantee and plan to die young.
- - - - - - - - - - - - - - - - - -
I'm proud of you son! I bought you this new corvette! Here is your payment book.

Just making a point.

It depends on how you present it. It's one thing to say "I bought this policy on you when you were a baby. Now you're grown. Here's the policy... and here's the bill."

It's quite another to say "I bought this policy on you when you were a baby. Now you're grown. Here's the policy... and here's what you can do with it...(cash out, RPU, auto premium loan, premium offset, etc). But if you keep it, your values will continue to grow with all the preferred treatment afforded permanent life insurance. Since the policy is already 20 years old, you have the benefit of a 20 year head start on covering the initial costs, and now your increase in value each year is substantially greater than the annual premium."

If the child wants to cash out, the parent could do a max loan, give the child the money, and KEEP the policy for themselves. A 20 year old policy could use the dividends to pay back the loan or at least the loan interest and the parent has the benefit of having a fully seasoned WL as another place to park some money for another day.