Life insurance usually gives parents a way to financially protect their children, not the other way around. Since you don't financially depend on your children, there's often no need to buy life insurance that covers them. However, there are situations where it can make a lot of sense to buy coverage.
Medical Bills And Funeral Costs
If one of your children became seriously ill or was hurt, their medical bills could quickly rise high enough to wipe out your life savings. While health insurance may help cover some of these costs, health insurance doesn't always cover everything — and it rarely covers funeral costs. Unlike medical debt belonging to other family members, medical debt you incur for your minor children becomes your responsibility — since you're financially responsible for them. A life insurance policy can help you pay off these debts.
Once your child turns 18, you may help them adjust to the real world by co-signing for an apartment, mortgage, credit card, or student loan. This is not just a routine signature that doesn't mean anything if you trust your children to stay on top of their payments. If something happens to them, their debts become your debts. While the creditors would likely look to their estate first, you'd need to pay off any remaining debts.
Family Medical History
Some people worry that if their children develop a chronic medical condition before they can buy life insurance on their own as an adult, they may never be able to qualify for a good life insurance policy. Most financial experts say this is a very remote risk; you're better off spending your money on something else if that's your only reason for buying life insurance. However, if a serious condition runs in your family that isolates your child as a greater risk, it may make sense to purchase life insurance early.
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