Why would anyone want to buy life insurance on a child or grandchild other than to cover final expenses?
There are several reasons. First, if permanent insurance (i.e. whole life or universal life) is purchased at a very young age the insurance company will often guarantee the child the right to buy more insurance later in their life at regular intervals without providing any evidence of insurability. In other words, if you buy a little now, you are guaranteeing your child’s right to buy more coverage later without having to submit to an exam and without having to answer any health questions. If the child later becomes ill, or uninsurable, these privileges could be the only means to obtain the coverage needed when the child becomes an adult. Example: One major company offers a rider to certain whole life plans which allows the insured to increase their coverage by purchasing up to $100,000 on each of 9 option dates between the insured’s age 22 and 46, for a total of $900,000 of additional guaranteed future insurability! If waiver of premium is included and the insured is totally disabled
