Whole life insurance pros and cons?

[Mommb]

Generally, someone buys life insurance when there are people who depend on the income of the insured. Most people don’t depend on their children’s income.
Some people have a small policy on their children to cover funeral expenses if they know they couldn’t afford one if needed.
I get family AD&D insurance through work and it costs around a dollar per biweekly paycheck.

Another reason to get a (small) life insurance policy for a child is to ensure the ability to purchase more insurance later if the child develops a condition that could otherwise prevent insurance or make it very expensive. Obviously, policies differ in how much future protection they provide, so not all policies would work for this purpose.

My father (who was an actuary) bought small whole-life policies for my sisters and me for this reason. After I was married and a parent, I purchased insurance that would better meet my needs and cancelled the original policy.

I agree with most previous posters that a single employed adult probably does not need whole life, or even term life, because no one is relying on their income.

I do think long-term disability insurance would be a good idea, though. As mentioned above, the chances of a young person becoming disabled are greater than the chances of dying. Someone who is unable to work will still need to pay for housing, food, and transportation, possibly for many years. A good disability policy can help with that.

 

[sarahk0204]

My kids are grown, but -- in general -- I'd say no. Kids are statistically unlikely to die, and -- if they did -- I have money to cover a funeral.
However, when my kids were small, I was able to get a $10,000 policy for all my kids for $1 per month through my work. I was willing to pay that $1 for the remote chance.

We have life insurance on our kids through DH's work. We pay about $25 per year. This is strictly to cover funeral expenses. We do not have savings earmarked for funeral expenses, and I consider crowdfunding for funerals an extremely tacky practice.

 

[LuvOrlando]

Most jobs don't let you take a policy with you when you leave employment so options other than term policies are often a waste, I'd ask if they follow the employee because if they don't and your child doesn't work there forever they will never get what they are paying for, they'll end up changing jobs.
We always got what was free or minimum with jobs but also had separate life policies independent of jobs for stability. For her age the disability benefit is a big help if she ever ends up pregnant and ill in some way that demands bed rest, it happened to me and I got 80% salary through maternity time off for close to a year so it was totally worth the low monthly payments. People think bad things can't happen but pregnancy can be very serious and even young men with young families shouldn't risk the loss if a few dollars covers it.

Lots of people say it's a waste when you are young but when we are young we don't have any diagnosis to prevent coverage or trigger big increases in premiums, I'm so glad I got mine young. I think the carriers write the policies so cheaply because most people don't keep up with them, I did on autopay & I'd do what we did over again in a heartbeat. When we were 29 with 2 new babies we picked up 20 year term with guarantee exchange riders so at 49 we were guaranteed the right to exchange our existing 20 year term for a new 20 year term, same health level as when I was 30 regardless of changes, needless to say there were a lot of changes that would have impacted insurance premiums. https://www.investopedia.com/articles/pf/07/life_insurance_rider.asp

 

[Shelly F - Ohio]

$1600 a year. WOW that is too much to pay. She could do better by going with a different company. That is a rip off.

 

[thegash35]

It's a complete ripoff.