Insurance by its very nature entails considering the worst.
Being prepared for a leak in the roof or a lawsuit against your business is unpleasant. When it comes to considering the mortality of our loved ones it can be so sobering we either go overboard to compensate or simply don’t want to know. Of all the policies, insuring against the death of a child is surely the hardest to consider. It has its defenders and detractors. In this blog, we will consider both sides of this delicate argument.
The argument for
Why do many parents feel it’s necessary to insure the lives of their children? The pro-insurance stance is almost as instinctive as the parental drive itself. The very idea of leaving a child uninsured against any outcome (particularly the worst) can cause anxiety and guilt in any guardian. To take out a policy seems like not only common sense, but a protective reflex.
Second to that is the projected expenses of death. The average funeral cost in America now runs around $8000-$10,000 and incorporate fees for funeral homes, cemetery plots and headstones. If your child dealt with illness before death then life insurance can also be a cushion against medical expenses which may not have been covered under a health insurance plan.
It’s easy to over-react emotionally on this issue but it’s a reality that the emotional fallout of a child’s death can incur financial expenses beyond the medical and final. Parents or guardians may lose time at work to grieve which may cause a loss of earnings. It is not so great a leap to imagine the job itself may be lost. Should that be so, a life insurance policy could yet again go some way toward softening the costs of loss of earnings and counselling.
Protecting a child’s future insurance status is another factor. It’s a pre-emptive measure especially if one or both parents carry an inherited condition. If a child is born healthy and continues to be so for several years but eventually develops a significant health issue, then this can leave them uninsurable in the future. However, if a life insurance policy was taken out at the beginning and a problem arises later, the child has secure insurance in place where the payouts can be reviewed and improved in later life.
The argument against
It may be easy to imagine the opponents of child life insurance as being negligent or even callous. While many people do treat insurance too lightly there are valid (and even highly optimistic) arguments for taking steady time to consider your decision, or maybe even forgoing child life insurance entirely.
The early stages of being a parent are an emotional experience often rooted more in nature than knowledge. The most recent figures show that of every 1000 children born in the United states, 6.5 will die before the age of five. Most parents would automatically panic that their child would be one of them. Anti-insurance parties feel that parents are taken advantage of, exploited even, by being made to pay out in fear of the worst. This feeling of child life insurance being an immoral and financially predatory practice is strong.
More tangibly, opponents of the idea of life insurance for children ground their argument in financial dependence. Insurance is a monetary safety net against unforeseen expenses that parent or guardians can’t cover on their existing income. Children don’t have any income and so are fully dependent on their parents. The argument here is that they already have financial life insurance in the form of Mom, Dad or other guardians. Of course, this argument only holds water for those in a certain income bracket and for whom funeral expenses would be manageable via income or savings.
Anti-insurance advocates also think that the money invested in fearing the worst should be directed toward hoping for the best. Using the funds to create a nest egg your child can use in later life towards education, a home or other important decision is viewed far more positively and practically. With higher education costs ranging from over $9000 to more than $32,000 depending on the institution, the argument certainly carries some weight.
Whatever your insurance needs or concerns, we’re here to help. Avante Insurance is a South Florida family owned and operated insurance agency providing an array of insurance services to meet individual needs. If you’d like to know more, you can call us at 305-648-7070, request an insurance quote or contact us with any questions or comments.