Losing a child is more common than you might think. A friend of my parents lost his seven-year-old daughter to a brain tumour, and one of my friends lost a sister at the age of 15.

But some advisors still won’t talk to clients about life insurance for children because they think it’s immoral or morbid.

Read: The value of insuring children

And one common objection clients have to buying life insurance for children or grandchildren is they don’t want to monetarily benefit from the child’s death. But if parents, or grandparents don’t need the policy proceeds they can use it to benefit others. For instance, they can set up a bursary or scholarship in their child’s or grandchild’s name, or make a charitable donation.

Read: Insurance and children

Remember, a child’s death is the worst case scenario and having life insurance can be a financial safety net for when the worst happens.

One advisor told me his friend’s teenage son committed suicide. The emotional duress made it hard for the husband to go into work, and it was the life insurance the family had on the son that kept the family afloat.

Read: Are your clients’ kids protected?

Another advisor heard of a situation where a family had to pay $180 per month to a funeral home until their child’s funeral costs were paid off.

So isn’t it best to prepare clients for these worst case scenarios?

Read: Insurance for young people

And when the kids turn into adults, those life insurance plans will allow them to:

  • buy more in the future at standard rates;
  • grow money in a tax-sheltered environment;
  • have a free transfer of ownership when mom and dad (or grandma and grandpa) think the time is right; and
  • in the event the policy is triggered, they’ll have a payment level decided upon by their families, not a funeral home.

So gently ask clients what plans they’ve made for the worst so they can live stress-free.

Helena Smeenk Pritchard has over 36 years of experience in the insurance industry and is the Principal of Helena Smeenk Pritchard & Associates, a leader in “Insurance Know-How” training. Helena publishes a weekly free ‘Did You Know’ newsletter on her site.

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I agree with almost everyone here but you are leaving out one HUGE reason for buying at least some insurance – with a Guaranteed Insurability Rider – for children. How many kids are diagnosed with Type 1 Diabetes or other serious illnesses? Insurance on kids is NOT to get paid if a child dies – it is to guarantee they have some insurance before they can no longer qualify for it. “It doesn’t happen!” Oh yeah – tell that to my son who is BiPolar – tell it to any parent whose child is diagnosed with a serious illness!

Tuesday, May 21, 2013 at 11:12 am Reply


Early in my insurance practice I would have agreed that money would be better spent on an emergency fund or RESPs than insurance.

Then, a client’s child died. The parents were unable to return to work for almost a year. Financial disaster ensued.

There are children insurance products that provide for both life and CI for a reasonable price with either a return of premium or paid up insurance. These products allow the parents to be at a sick child’s bedside or to mourn without negatively affecting the families finances.

When you buy auto, home or term insurance, you don’t expect to use it. You are protecting your family again loss. Nothing is more valuable to each of us than our family. This insurance protects the family against the unthinkable.

Friday, May 17, 2013 at 1:56 pm Reply


Kid’s don’t need life insurance. Parents who can’t afford to pay for a child’s funeral out of pocket, do.
If an average family is property protected with a term policy as part of a total financial plan they already have a child ride for pennys for the unthinkable.

Friday, May 17, 2013 at 11:53 am Reply


I don’t think the argument here is about benefitting from the untimely death of a child. It is about how to best allocate precious funds for unforeseen emergencies. The chances of a non-infant child dying before age 15 are astronomically low (less than 0.02%). Anecdotal stories aside, child mortality rates have been declining for the past 100 years.

Better to put those insurance premiums into your emergency fund then think about starting up a TFSA when the child turns 18. Sorry, lower commissions but better advice.

Wednesday, May 15, 2013 at 11:35 am Reply