When you experience the unexpected death of a child this event may be the most devastating life-altering occurrence imaginable. It’s difficult to even think about this topic, however oftentimes the unthinkable happens, which is why having Child Life Insurance is so important. As unimaginable as the experience would be, a life insurance policy on your child can make it a little easier by providing the funds to cover these and other expenses–especially if your child has been diagnosed with a chronic illness.

What Is Child Life Insurance?

Child life insurance policies are similar to those for adults except that they cover minors. The insurance is intended to protect a parent or guardian from the unexpected cost of a funeral or burial. Knowing your child has a chronic illness is a worthwhile reason to purchase a life insurance policy while they are young, as it also guarantees the child’s lifelong insurability. Plus, a permanent life insurance policy could serve as a vehicle for cash accumulation for your child’s future.

Benefits of a life insurance policy for children

  • Cash value – Over the course of time, a Child Life policy builds cash value and can be accessed in the future for expenses such as school tuition, buying a new house, or any other large-scale purchase. This type of policy provides a ready source of liquidity to use as you see fit, and the cash value grows as your child grows up.
  • Rates and coverage remain the same – The premiums you purchase can be designed to remain constant for life. They can also be paid over a shorter period of time.
  • Locking in future insurability – If your child is suffering from a chronic illness or develops a disability at a later stage in life, buying the right insurance policy now will guarantee your child the ability to buy the coverage they need–even if their health would otherwise make it difficult or unavailable.
  • No medical exam necessary – Because children are generally not required to go through the exam process as adults, obtaining a child life policy can be easier than other types of life insurance. If the chronic illness is already diagnosed, applications might only require answering a few questions and providing medical documentation.

Some tips on the best policy for pre-existing conditions

  1. Educate yourself on the different policy types and benefits for your child. Understanding the differences can be as clear as night and day. Think about long-term savings goals, the most comprehensive versus the least expensive policy, and whether you want to use the policy as a cash-accumulation tool.
  2. Work with a qualified agent. A trained agent can help you identify where your greatest needs are and assist you in choosing a policy that satisfies those concerns.
  3. Be honest about your child’s health condition. Coverages and policy amounts are dependent on risk factors, therefore be straightforward about your child’s chronic illness to avoid any insurance claims being delegitimized or your policy being refused altogether.
  4. Name yourself as the beneficiary. Whether it be a parent, guardian, caregiver, or grandparent, naming the proper beneficiary gives you the option to use the proceeds from the policy to pay for any unforeseen bereavement expenses. Also, if you’re taking time out of work to care for the child, naming yourself as the beneficiary is vital to missing out on expected income through your employment

In summary

If your child has a serious illness or is disabled, finding a life insurance policy may require more research and jumping through hoops to acquire the right premiums and with whom. The extent of your child’s condition–or to what degree your child disabled with a chronic illness–will determine whether or not they are insurable. While you may find insurance for your child without any problems, the cost of the policy may be as expensive as a plan for an adult with serious health conditions.

Still, life insurance for children can be valuable for a child whose condition might be improved by a policy with features such as accelerated benefits, which can provide access to funds for medical bills. The key is to work with a licensed insurance agent who can help you to make educated choices about your budget and unique coverage needs.