Insurance
Dumbest Insurance – Life Insurance for Child
By Singapore Man of Leisure  •  May 25, 2014
Life insurance for a child ranks to me as the dumbest Life insurance policy out there. These policies are never bought; only sold to. From one salesperson to another, must give a round of applause for these super salespersons - these are the ones who can sell ice to Eskimos! Take a step back and press reset for a moment: 1. Are you a dependent of the child? 2. What is the coverage for? a) To benefit from your child's passing? b) To pay for an elaborate and grand burial for all to see? If your motivation is fear that your child may catch an illness or accident, wouldn't a Critical Illness and/or Hospital and Surgical plan be better? Or perhaps you want to give your child a better future, wouldn't a Savings or Education Fund be better? Of course you will never be sold Life insurance for a child by itself. If you are a student of the recent sub-prime meltdown, you would understand the wonders of packaging and repackaging of financial products until everyone looses sight of the unsavoury bits. What you really wanted were the medical benefits and savings plans for your child - your motivation is love. What you never bargained for was as part of a set menu, you got something you never needed in the first place - greed and ego were never part of your motivations... If you knew what you knew now, you would have gone a la carte.
Singapore Man of Leisure (welcome to my blog; just google it!)
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By Singapore Man of Leisure
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4 Comments

4 responses to “Dumbest Insurance – Life Insurance for Child”

  1. Chris says:

    What an amazingly ignorant and biased article. There are many reasons for life insurance on a child, my own children have it. They are building wealth in a tax sheltered environment (which can be used for things other than just school), locks in their insurability with the ability to continually increase their insurance, and locks in their rates as a child with no medical exam. Term life isn’t a need, but you’re lumping all life insurance together. A savings fund won’t grow as nearly as well if it’s not sheltered from taxation. Very poorly researched, a proper financial planner should have assisted the writing of this article

    • Jared Seah says:

      Chris,

      Thanks for the feedback.

      Let’s see what you touted:

      1) Life insurance for child as a vehicle for building wealth in a tax sheltered environment, For the child or the parent?

      2) Term life isn’t a need. Hey! We are in agreement ;)

      3) Savings fund’s return beats term life, but may lose out to wholelife and endowment life policies. Not lumping together now. If that’s the motivation, are there other vehicles that are better than wholelife and endowment for pure savings/investment need?

      By the way, are you still working in the industry?

  2. abc says:

    Agree on locking in insurability so that in future, they can still get insurance even if they are found to have existing illness then.

    Would either do a term life insurance (minimal amount if got insurance that allows for increase in coverage even if later found to have existing illness) and/or a living insurance (full cover if can afford) plus also medical insurance (full coverage).

    • Jared Seah says:

      abc,

      That’s an interesting motivation for buying – locking in insurability…Fear? Fear of losing out? Buy now wait next time cannot! Kaisu? I “smart”; insurance company not stupid.

      Term insurance for child. If we bought $200K term on our child, and our child passes on. It’s still the question of what is this $200K for?

      Savings and medical care no longer apply now. What’s the motivation now?

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