Life Insurance for Children and Grandchildren
Buying life insurance on a child is a question that makes some people uneasy, and it's fair to ask whether it's needed. Kids don't earn income, so the case is different from an adult's. But there are real reasons parents and grandparents do it. Here's an honest look.
Reasons people buy coverage on a child
- Funeral costs. Unthinkable, but a child's funeral can cost $8,000 or more, and parents may need time off work to grieve.
- Guaranteed future insurability. A policy bought at age 2 stays in force even if the child later develops diabetes, heart issues or another condition that would make coverage hard to get as an adult.
- Very low lifetime premiums. Whole life bought for a newborn has the lowest premium that policy will ever have, locked for life.
- A small savings head start. The cash value grows for decades and can be handed over to the child as an adult.
- A meaningful gift from grandparents. Something that lasts longer than a toy.
Reasons it may not be the best choice
- If parents don't have enough coverage on themselves yet, that comes first. The parents' income is what the child actually depends on.
- As a savings vehicle alone, a 529 college plan or a custodial account may grow faster.
- Premiums paid for decades on a small policy add up.
Your options
| Child term rider | Juvenile whole life | |
|---|---|---|
| How you get it | Added to a parent's term or whole life policy | A standalone policy owned by a parent or grandparent |
| Who's covered | All children in the household under one rider | One child per policy |
| Typical amount | $5,000 – $25,000 | $5,000 – $50,000+ |
| Cost | A few dollars a month, one price for all kids | Often $3 – $15 a month per $10,000 for a young child |
| Builds cash value | No | Yes |
| Lasts until | Usually age 23–25, then can convert | Lifetime |
| Conversion to adult coverage | Usually up to 5× the rider amount, no health questions | Already permanent; some offer guaranteed purchase options |
Can grandparents buy a policy?
Yes, with the parent's consent. A grandparent can usually be the owner and payer of a juvenile whole life policy on a grandchild. Key points:
- The owner controls the policy, so name a successor owner in case the grandparent passes first
- Ownership can be transferred to the grandchild when they're an adult
- The beneficiary is typically the child's parents
Examples from the market
Mutual of Omaha offers a children's whole life policy for kids from about 14 days old through age 17, with a guaranteed option to buy more coverage later. Many term policies from carriers such as Transamerica and Corebridge Financial offer a child rider that covers all children in the home under one charge.
Ages and amounts change; confirm current product details.
A practical order of priorities
- Coverage on both parents
- A child rider on a parent's policy (inexpensive, covers all kids)
- Juvenile whole life, if you want guaranteed lifelong insurability or it's a gift from grandparents
A gift that grows up with them
Compare a child rider with a standalone children's policy and see what fits your family, or your grandchildren, best.
This guide is general education, not tax, legal or financial advice. Product features, issue ages and prices vary by carrier and state and change over time.