Children’s Life Insurance: Meet Anthony and Melissa

Couple et leur bébé

This is the story of Anthony and Melissa, a couple who opted to buy life insurance for their newborn.

Once upon a time…

There was Anthony and Melissa, a young couple who was anxiously awaiting their first child. Each day, they would daydream about what their child would look like. Hair colour? Nose shape? Eye colour?

Of course, they spent months basking in how magical and unforgettable this event will be. One day, however, a new series of questions crept into their minds – questions about what would happen if their baby got sick. And one morning, they decided to answer them.

Does our child need life insurance?

Sitting at the kitchen table, Anthony and Melissa asked themselves the big question. Unfortunately, they immediately realized that neither of them can predict the future.

To help them decide, they sat down together to assess their situation. Anthony and Melissa are not yet 30. They both work full time. Their finances are in good shape. However, like most young couples, neither of them has individual life insurance.

They look at their family’s medical history. They see no obvious hereditary diseases, although Melissa has gestational diabetes, that should go away after giving birth. Is that a sign of possible future serious illness? Who knows?

Personne qui tient de la paperasse

What if we took out life insurance?

Anthony and Melissa decide to do their research. They learn that in 2020 in Canada  (This hyperlink will open in a new tab)., 4.4 children in every 1,000 died before their first birthday. This is nearly the same rate as the 55-59 age range, which is at 4.8.

When it comes to taking out children’s life insurance, there are three options:

  1. If Anthony and Melissa each had life insurance, then they could simply take out additional coverage to their policy.
  2. They could take out Term life insurance.
  3. They could take out Permanent life insurance.

Financial advisors will work with parents to help them find the best coverage.

And what about critical illness insurance?

Anthony and Melissa continue their research and stumble upon critical illness insurance. Critical illness insurance pays a tax-free lump-sum amount that they can use to pay for expenses when one of them has to take care of the child.

Depending on the policy, they may even be entitled to assistance benefits like a second medical opinion, hospital admission assistance as well as psychological assistance.

It can also be combined with a whole, universal and term life insurance policy.

Their decision

Staring at a mountain of paper and scribbled notes, they realize that they must talk to an advisor to help them build a plan specific for their needs.

The moral of the story…

Even difficult questions have answers, but sometimes it’s just a matter of knowing who to ask, like a financial security advisor.