Anonymous
Anonymous asked in Business & FinanceInsurance · 1 month ago

Why do companies like Gerber offer life insurance for underage children and even babies?

What's the point?

Life insurance as I understand it is something the bread winner has in case they die, so their spouse and children won't be bankrupt or lose the home.

But last I checked, I am not dependent on my 9 year old for income.

14 Answers

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  • B
    Lv 7
    1 week ago

    the insurance companies know there is very very low risk in insuring youngest persons, that's the basic idea.

  • 1 month ago

    First, Gerber is a very well respected and well-rated company. Life insurance is a very personal decision. The kind of insurance is heavily regulated but not mandated by laws. Insurance as a whole industry is an insurance against what might happen. It's really the best kind of cooperative. Many people pooling money together to help the "one" that is in need. For a more detailed review of Gerber and other life insurance companies you can read a full report:https://choiceseniorlife.com/best-funeral-insuranc...

  • 1 month ago

    Excellent sales gimmick...that is all. Sure, its real life insurance and would likely cover a funeral...but they sell it because people buy it.

    • john
      Lv 4
      1 month agoReport

      You're right, Casey, and having a life insurance plan to cover a $15,000 funeral is a bad investment (better to put those monthly premiums into a savings account). But people buy it, so they sell it.

  • zipper
    Lv 6
    1 month ago

    If the baby dies it cost nearly as much to bury the baby as it does an adult, it is family protection just in case the baby dies. Next time STOP AN THINK or you really that stupid?

    • john
      Lv 4
      1 month agoReport

      Zipper, the asker is NOT stupid! It's NOT 'family protection' to pay for a bad insurance policy that costs your family more in the long run.You're paying monthly for $15,000 funeral when most babies don't die? You can SAVE $15,000 faster than that. I lost 2yo sister and 13yo brother.I KNOW.

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  • Anonymous
    1 month ago

    The death of a child is a tragic event.  Then if the family is also faced with the expense of the funeral, it can turn an already tragic event into a financial nightmare.

    Life insurance for children is a safety net for funeral expenses in the event that the child would die either of a medical reason or an accident.

    A life insurance policy on a child should be for an amount that would cover funeral expenses and maybe a little buffer for possible medical expenses.  A reasonable policy on a child would likely be between $10,000 to $20,000 and not much more although you can pick the amount in many cases.  (I had a $25,000 policy on each of my children that was actually offered through my job at very, very low cost.  It didn't have any other cash out value and couldn't be converted when they became adults, but it gave me piece of mind to know that if the worst thing happened, I wouldn't need to worry about expenses.)

    These policies also sometimes have a "cash value" at a certain point and can be "cashed out" instead of continued.  Or, some of these policies may let the child continue the policy as an adult.  They get to upgrade their amounts but get lower costs since the account has been active for many years.

    It isn't like insuring the "bread winner" of the home who should be insured for at least 5 times their annual salary.  (so, someone bringing home 100,000 per year should be insured for 500,000 on life insurance.)

    • john
      Lv 4
      1 month agoReport

      I lost a 2 yo sister and 13 yo brother.Your logic is off.You pay more long run for your $20,000 policy in the unlikely event that child dies. SHOULD your child die, people step forward--and you could probably get a bank loan if necessary. Money-maker for gerber, no help for grieving families.

  • Pearl
    Lv 7
    1 month ago

    maybe theyre trying to make money off it

  • 1 month ago

    ONE use of life insurance is income replacement. Another use is final expenses which includes funeral expenses.  Last I checked, children's funerals are not free.

    That being said, my opinion is that a parent's life insurance policy with a rider to cover all of the children makes more sense.

  • Judy
    Lv 7
    1 month ago

    It's just an effective sales gimmick

    • john
      Lv 4
      1 month agoReport

      Right on, Judy! I've been away from Yahoo!Q for awhile but Judy, I'm glad to see you're still here now that I'm back. I always liked your posts, Judy. ['John' is my new Clark Kent alias--never mind who I used to be.]

  • Eva
    Lv 4
    1 month ago

    They use it like a savings plan. The child can cash the policy in when they reach 18, or they can continue to carry the policy. Once they are of age, they can change the beneficiary.

    • john
      Lv 4
      1 month agoReport

      ...but it's a BAD savings plan. Better to invest your 'policy' money in the stock market and give your child the money when he/she grows up. Whole term life insurance is always a bad deal.

  • 1 month ago

    Companies like Gerber provide life insurance to cover funerals.

    But Suzi Orman recommends that ALL PARENTS purchase life insurance on their child in the amount of 1 year of their own income. If your child died tomorrow, would you be able to return to work with only 3 days bereavement and successfully hold your job? Most parents wouldn't be able to.

    • A Hunch
      Lv 7
      1 month agoReport

      Life goes on & we do what we need to do. But John, you are an imbecile if you don't think your family would have been able to grieve better, if your parents didn't have to return to work within a few days.

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