Life insurance for children protects the parents financially when their child goes through a traumatic event. Life cover plans for children are designed keeping a lot of factors in mind and these plans are usually flexible. A few insurers offer premium free life cover plans for children where the child gets an add on cover for no additional cost provided one of the parents already has an insurance policy with the selected insurance company.
Child cover plans that are offered separately or as add on cover have many benefits. Some of these benefits include a tax free lump sum payment when the child is diagnosed with a terminal illness, suffers a traumatic situation or passes away. Depending on the insurance company selected, the insurance amount can be up to $200,000 and in most cases the minimum amount that can be insured is $10,000.
Policy holders who want to opt for add on, premium free policy get a choice to add one or more children to their policy. These policies cover the children up to they turn 18 or 21, after which the children can take a new policy or continue with the existing policy as an adult. Buyers who want to opt for individual or separate policies should note that as of now in Australia only term policies are offered for both children and adults. Term policies protect the policy holder for a limited time and the policy holder can decide how many months or years he wants to be insured.
Like all life insurance plans, buyers who opt for policies with premiums, have the option to pay either stepped or levelled premiums. Buyers also have the option to decide when they want to pay the premiums that is every month or once a year. Buyers should remember that, like other insurance plans, if the policy holder decides to pay a premium on a selected day but cannot, then the policy will be cancelled shortly after the missed payment.
There are various benefits of opting for life insurance for children. The main benefit is that the parents can be sure that in case their child is terminally ill, they do not have to worry about money and they can get their child the best help possible. In addition these policies allow parent to take leave from work to take care of their child and ensure that their child can be comfortable when he is ill.