Financial security
Purchasing life insurance for children can provide financial security in case of unforeseen events such as a serious illness or accident. In the event of a child's death, insurance can help parents cover funeral expenses.
Advantage of early age
Insurance at early age can be more affordable and cheaper, as the cost of premium depends on the risk of diseases and possible health problems.
Investments
In some cases, parents may consider investing in life insurance policies.
Types of life insurance
There are several types of life insurance designed to protect the financial interests of the client and their families in Canada and other countries.
Term Life Insurance
This is one of the most popular types of life insurance; it provides coverage for a specific period (e.g. 10, 20 or 30 years). If the insured person dies during the term of the policy, the insurance company pays the coverage sum (indemnity) to the beneficiary of the policy.
Whole Life Insurance
This type of insurance provides lifetime coverage. In addition to coverage sum in case of death, the policy can also have an investment component, which allows accumulate cash throughout the life of the insured person. This cash can be used for a variety of purposes, including retirement or other financial needs.
Universal Life Insurance
This type of insurance also provides lifetime coverage and investment opportunities. Universal life insurance allows you to flexibly manage the coverage amount and premiums.
Investment-Linked Life Insurance
This type of insurance combines elements of life insurance with investment products. One part of the premium goes to cover the death risk, and the other is invested in selected investment funds. This allows the client to get potentially higher returns but with investment risk.
Each of these types of life insurance has its own peculiarities and is designed to cover the various financial needs of the client. Before purchasing life insurance in Canada, it is recommended to consult a professional insurance expert for advice that is appropriate for your situation and financial goals.
Source: https://www.stratfordtoday.ca/spotlight/should-you-buy-life-insurance-for-children-7206320
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