Baby Life Insurance: Explanation Of Baby Life Insurance

It is the worst thing that could ever happen; your child gets very sick or possibly—the unthinkable. When you have baby life insurance, you have peace of mind that you can give your baby the best care possible when tragedy strikes.

Baby Life Insurance comes in different forms so you can choose the type of insurance that best suits you and your family. The two main categories are whole baby life insurance and term baby life insurance, and each can be tailored to fit your needs.

  1. Whole baby life insurance will give your baby a lifetime of financial protection. This policy can cover your baby throughout childhood and then can be signed over to him when he becomes an adult, continuing to provide coverage throughout his adulthood. Also, whole life insurance accrues a cash value that can be put back into your baby’s insurance or withdrawn as a cash dividend.
  2. Universal baby life insurance is similar to whole baby life insurance with the additional ability of using the policy as a highly effective, tax-deferred savings vehicle for your child’s education and the transfer of wealth from one generation to the next.
  3. Term baby life insurance will give your baby coverage for a predetermined amount of time. When the time period runs out, the coverage ends and there is no cash dividend. It is possible to renew; however, the premiums will be reassessed and will increase dramatically. The benefits to term baby life insurance are lower premiums for a higher and fixed payout, regardless of how long you have been paying premiums.

Baby life insurance can be purchased for a child at any time from prenatal to teens. It can be purchased by a parent, grandparent or legal guardian, with most state laws requiring parental authority, and the owner of the policy can name anyone, such as the child’s parents, as beneficiary. A child’s qualification is very simple and is usually just a few basic medical questions. When the child comes of age, the policy can be signed over him for continued coverage into adulthood.

Baby life insurance has one main purpose: to provide financial aid to the insured’s survivors. During such a tragedy, your baby life insurance can take care of money worries, and you can put your mind to more important things.

Baby Life Insurance: Why Buy Baby Life Insurance?

Baby Life Insurance: Explanation Of Baby Life Insurance

Baby life insurance covers your baby for the same reasons insurance covers adults. When tragedy strikes, whether it is illness or death, there are costs that need immediate payment. A funeral can cost anywhere from $7,000 to $10,000. You will also have medical costs and lost wages during and after such a tragic event. These are significant costs and for most people, it can mean facing years of heavy debt. Having baby life insurance means being able to quickly and easily cover all these unexpected expenses and eliminating money worries during a very troubling time.

In addition to the primary service baby life insurance provides, it has many additional benefits:

  1. When your child becomes an adult, he will have an insurance policy with a very low premium because a policy is based on the person’s health and life expectancy; as an infant, he is at his healthiest and is furthest from death. The premium is never reassessed; it remains the same throughout the duration of the policy.
  2. If your child does develop an illness, he is still guaranteed coverage, whether he is a child or an adult. Trying to find life insurance after your child has become sick can be very difficult. You or your child will end up paying very high premiums; he could even be uninsurable.
  3. When your child reaches university age, you can withdraw the premiums to pay for tuition fees or any other expenses. You will have an amount equal to or even greater than the amount you put into the policy. Most policies have an interest rate of approximately eight percent per year.
  4. Term life insurance comes with many tax shelter and tax-deferred benefits to help you manage your money and help create a more secure future for your child.

Baby life insurance can help you plan for your baby’s future. Having financial security can ease your money worries and allows you and your child the freedom to dream of his future and its endless possibilities.

Baby Life Insurance: Costs Of Baby Life Insurance

Baby life insurance can be very affordable and can give you a significant payout at the same time. Do not sacrifice the present for the future. Purchase a policy that you can afford comfortably. Your premium will be based on a number of factors and a variety of benefits, allowing you to tailor your policy to fit your needs.

Baby Life Insurance: Why Buy Baby Life Insurance?
  1. You can purchase baby life insurance any time from before he is born and into his teens. Insurance is partly based on life expectancy; therefore the younger your child is, the lower your premium will be.
  2. Insurance is also based on health. As a baby, your child is at his healthiest. As he gets older, becomes an adult and even elderly, the chance for disease and illness grow. As this chance of sickness increases, so does the premium cost on a policy purchased later in life. Your baby life insurance premium will stay the same for the length of the policy, providing your child with affordable life insurance for his entire life.
  3. You can choose the amount of coverage you want. A smaller coverage amount equals a lower premium. As you increase the amount of coverage, your premium will increase. Your child can choose to adjust his coverage when he is an adult.
  4. Insurance is governed by your state. Each state has different laws that can affect your premium.
  5. If you opt for universal baby life insurance, you can voluntarily increase your premiums to save money in a tax-sheltered savings vehicle.
  6. Since the low premium for baby life insurance never increases, you will save your child from having to purchase life insurance at a much higher cost when he becomes an adult. Some insurers will even automatically increase coverage without increasing the premium when your child becomes an adult.
  7. There is no additional tax to you or your child when you sign over the policy.

Policy premiums start at much less than $100 per year and increase depending on the amount of coverage and the benefits you want. You want to secure your baby’s future, and adding baby life insurance to your arsenal will greatly increase his chances of success.

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