Term Insurance for children?

[dgeralds]

I already have a whole life policy with critical illness for my 3 year old son. Also wanted to take term insurance for him but was told term insurance are not available for children. Is this right? Why is it so? I thought if you buy a term insurance at young age, we can lock the premium.

Please comment. Thank you.

 

[Senpai]

There is term insurance available for children, minimum age of 15 days. May i know why you wish to take up an additional term insurance for your son? Is this additional term insurance in the form of an early critical illness plan?

 

[Shiny Things]

I'm going to reject the premise of your question. Life insurance - term life or whole life - is designed to provide cash for your dependents so they can keep the lights on and the fires burning in case you get hit by a bus. A three-year-old doesn't have any dependents.

Kids don't need life insurance. All they need is a shield plan. If you buy life insurance for a kid, all you're doing is writing a check to the insurance company. (The "locking the premium" thing is a scare tactic - you're subsidizing the premiums in sixty years time by paying an overinflated premium now.)

 

[dgeralds]

So what is the best insurance for a 3 year old. I have already bought a life with critical illness. And also bought a full medical coverage.

So at what age a term insurance is recommended? My intent is basically lock the premiums if bought at young age.

I wanted to buy some plans as a saving for uni education but the returns are very marginal after 20 years of payment.

I'm going to reject the premise of your question. Life insurance - term life or whole life - is designed to provide cash for your dependents so they can keep the lights on and the fires burning in case you get hit by a bus. A three-year-old doesn't have any dependents.

Kids don't need life insurance. All they need is a shield plan. If you buy life insurance for a kid, all you're doing is writing a check to the insurance company. (The "locking the premium" thing is a scare tactic - you're subsidizing the premiums in sixty years time by paying an overinflated premium now.)

 

[Lewis.T]

If you want to go by the book, as Shiny Things said, children do not need insurance that cover their lives because they do not earn an income and have no dependants.

However, do get an integrated shield plan for them, as this will defray the cost of hospitalization and surgical expenses if there is a need to. You may also wish to consider an accident plan for them as young children and elderly are more prone to that. (Accident plans are also very inexpensive)

 

[sgdividends]

I'm going to reject the premise of your question. Life insurance - term life or whole life - is designed to provide cash for your dependents so they can keep the lights on and the fires burning in case you get hit by a bus. A three-year-old doesn't have any dependents.

Kids don't need life insurance. All they need is a shield plan. If you buy life insurance for a kid, all you're doing is writing a check to the insurance company. (The "locking the premium" thing is a scare tactic - you're subsidizing the premiums in sixty years time by paying an overinflated premium now.)

Hi Shiny,

How about locking in the insurability thats why we buy term for kids before they get pre-existing illnesses?

 

[Senpai]

I'm going to reject the premise of your question. Life insurance - term life or whole life - is designed to provide cash for your dependents so they can keep the lights on and the fires burning in case you get hit by a bus. A three-year-old doesn't have any dependents.

Kids don't need life insurance. All they need is a shield plan. If you buy life insurance for a kid, all you're doing is writing a check to the insurance company. (The "locking the premium" thing is a scare tactic - you're subsidizing the premiums in sixty years time by paying an overinflated premium now.)

Your argument revolves around only traditional life policies right? What if the coverage is from an investment-linked policy?

 

[Shiny Things]

Hi Shiny,

How about locking in the insurability thats why we buy term for kids before they get pre-existing illnesses?

No. Like I just said five seconds ago, this idea of "locking in" insurability or rates is a scare tactic. Unless your kid is an Cartman-grade fatass, the odds are that they're not going to get a pre-existing condition that disqualifies them from coverage. These are vanishingly rare. Insurance salesmen try to scare you with "oh but what if your kid gets heart disease at age twenty"? This shits me to tears. Your kid is not going to get heart disease at age twenty, or thirty, or forty, or probably even fifty, and it's not worth paying sixty years' worth of premiums so that your kid can have term life coverage when he doesn't even need it.

Also, think about this - when you die you'll be saddling your kid with an insurance policy they might not want. That's kind of a dick move - you're leaving them with the opposite of a phat inheritance. Don't be a dick. Don't do that to your kid.

You, and your kid, should only buy insurance when you need it. For term life, that's "when you have dependents".

 

[Shiny Things]

Your argument revolves around only traditional life policies right? What if the coverage is from an investment-linked policy?

That's even worse! If the coverage is from an investment-linked policy, then you're paying extortionate fees for the same investments you could get a lot cheaper from the SGX or the NYSE. If you buy your kid an investment-linked policy, then you are a monster and your kid will grow up to hate you and probably run off to join a hippie commune and get an arts degree and become a barista. A BARISTA.

 

[audio123]

No. Like I just said five seconds ago, this idea of "locking in" insurability or rates is a scare tactic. Unless your kid is an Cartman-grade fatass, the odds are that they're not going to get a pre-existing condition that disqualifies them from coverage. These are vanishingly rare. Insurance salesmen try to scare you with "oh but what if your kid gets heart disease at age twenty"? This shits me to tears. Your kid is not going to get heart disease at age twenty, or thirty, or forty, or probably even fifty, and it's not worth paying sixty years' worth of premiums so that your kid can have term life coverage when he doesn't even need it.

Also, think about this - when you die you'll be saddling your kid with an insurance policy they might not want. That's kind of a dick move - you're leaving them with the opposite of a phat inheritance. Don't be a dick. Don't do that to your kid.

You, and your kid, should only buy insurance when you need it. For term life, that's "when you have dependents".

Hi Shiny,

No doubt you give good advice to people here in the forum on how to better manage their money. BUT I hope that you can at least be more responsible with what you say when it comes to advising on insurance.

Childhood and adolescent cancer statistics, 2014. - PubMed - NCBI

This is a research article showing the statistics on the number of children that get cancer (one of the 30 covered Critical illness) in the USA. Although we are living here in SG, but as a general guide it is applicable to us.

'Approximately 1 in 285 children will be diagnosed with cancer before age 20 years, and approximately 1 in 530 young adults between the ages of 20 and 39 years is a childhood cancer survivor.'

Telling people that they are a dick for buying life insurance for their kids when they don't need it.. Criticizing them making them feel like **** when all they want is to care for their kids.

There are 855K kids in Singapore at the moment

Statistics Singapore - Latest Data

Hence Base on that statistic given in the research paper that 1 in 285 children will get cancer before the age of 20, let me inflate the figures slightly... Perhaps 1 in 800 children here get cancer. so the 1000 kids that get cancer do get monetary aid? are you intending to support these kids and families?

This is just cancer... I have yet to include the statistic from other diseases. If we add everything up, probably we get at least 10k or so?

If you are not then I hope you can express your views on insurance in a more balanced manner. You may hate insurance but please don't bring that hate to the general community. The lay people here need some form of insurance coverage no matter. Because when things do happen the people that get into deep **** is them and not you. You can still sit behind your computer/tablet going on and on about how useless insurance is if you do not need it at the moment. But these people who take your advice on insurance are then left to suffer on their own in silence.

don't intend to start a fight or quarrel but hope you understand my point.

 

[MaoZeDuo]

Hey TS, hopefully ur whole life plan is a limited pay. That is one good insurance for ur kid already, in fact its even better than an endowment.

Most imptly u and spouse are well insured!

 

[Senpai]

I hope you can express your views on insurance in a more balanced manner. You may hate insurance but please don't bring that hate to the general community. The lay people here need some form of insurance coverage no matter. Because when things do happen the people that get into deep **** is them and not you. You can still sit behind your computer/tablet going on and on about how useless insurance is if you do not need it at the moment. But these people who take your advice on insurance are then left to suffer on their own in silence.

don't intend to start a fight or quarrel but hope you understand my point.

Well said, hear hear.

 

[FP_IFA]

From this very forum, I have a chance to come across a young lady suffering from Leukemia. It is with meeting up with these people that makes you appreciate things more. But there is little one can do then.

Its ok that people are giving advices in the forum. Just be more responsible and think of things from both sides of the coins before posting.

Just my 2 cents worth.

 

[focus1974]

Wa..just nice..
I was thinking of asking insurance for kid too.

My 2yr old got a Medishield and Medisheidl plus for total of $520 yearly premium.
is this correct? I also donno what i am paying for .. lol

I have a term insurance of $600k insured.. this one is separately paid for.

now I have a new born ... and i want to get her insured. But CPF just sent me a medisheild cover for only $48 (why am i paying like $520 for the 1st child from private insurere??? ) ... 1 yr coverage .. Do i need to get her insured this year or when the cover is due to expired end of 2015?

So what is the best solutino for me? Is there a way to lump all the insurance into 1 plan ? Like I buy term insurance.. you give free coverage for kids?
please advise.

 

[NiteX2]

Wa..just nice..
I was thinking of asking insurance for kid too.

My 2yr old got a Medishield and Medisheidl plus for total of $520 yearly premium.
is this correct? I also donno what i am paying for .. lol

I have a term insurance of $600k insured.. this one is separately paid for.

now I have a new born ... and i want to get her insured. But CPF just sent me a medisheild cover for only $48 (why am i paying like $520 for the 1st child from private insurere??? ) ... 1 yr coverage .. Do i need to get her insured this year or when the cover is due to expired end of 2015?

So what is the best solutino for me? Is there a way to lump all the insurance into 1 plan ? Like I buy term insurance.. you give free coverage for kids?
please advise.

The $48 is the basic Medishield that all Singaporeans will have unless they opt out. It only covers partial medical expenses. Please get the upgrade for your daughter asap. There's no free coverage for kids if you buy term lol. You can look at Ntuc family insurance if you wish to lump all the insurance in one plan

 

[lennontanhk]

This is what i did for my kids. This is to cover any hospitalization, medical & critical illness expenses should any unfortunate event happens.

Shield plan + Rider (Prudential)
Early Stage Illness
Critical Illness
Term Plan (SAF Aviva)
Accidental (SAF Aviva)

I personally find SAF Aviva plan very affordable. So if you are looking for coverage and protection, its a good option. The only requirement is that they need to tag to you.

 

[naro]

I already have a whole life policy with critical illness for my 3 year old son. Also wanted to take term insurance for him but was told term insurance are not available for children. Is this right? Why is it so? I thought if you buy a term insurance at young age, we can lock the premium.

Please comment. Thank you.

Personally, I don't think children need term insurance at all. The parent should get term insurance to increase coverage.

As a parent myself, my coverage must cover all my liabilities and the amount of money required by my dependants before they are financially independent. Example, a parent has a $500k housing mortgage and a 1 yr old son. Estimated expenses for the child is $10k per year and the son would be financially independent at age 25. This would mean that $240k of coverage is required on top of the $500k to cover the mortgage. So, this parent require at least $740k of coverage. This is the most basic life/TPD coverage that a parent should need. You can then add on the CI/early CI coverage as riders if one's budget allows. My personal preference is for riders to be tagged to an whole life insurance rather than a term insurance.

Decision on insurance should be based on the amount of money that one can afford. Thats why it must first start off with basic needs first.

For children, the most important insurance to get is the hospitalization and surgical insurance. If one can afford, get the integrated shield plans for private hospitals. Add the co-insurance/deductible rider if one can afford. Daily cash rider is recommended for self-employed because self-employed person will lose a day of income for each day of accompanying the child in the hospital.

Beyond this basic, its a toss between education fund and whole life insurance.

Education is the best gift a parent can give to his/her children. If one has the aptitude for investment, can ignore buying endowment for the education fund. Most basic would be for local university. For overseas university, one definitely has to go the investment route. I've did a calcuation, to build a $200k fund in 20 years, one has to invest $300 monthly and earn 8% per annum.

For whole-life insurance, it would be a bonus gift if one can afford for his/her children. This will give the child the base coverage and he/she would not need to pay once financially independent.