Toddler who Died in Hot Car Had Two Life Insurance Policies

[Norwayguy]

I don't understand why people think it's wrong/stupid/morbid/etc to get a policy on a kid. Both of my kids have multiple policies- probably over $200,000 each in a combination of whole life and UL. (both my dad and I buy them when we can-you can't be over insured.)

I want to make sure that they have adequate insurance in case they can't get it later in life- there was a time where I couldn't get a dime. Also, the cash value build up will be enough so that they could get a car or pay for books at school or pay for a few meals at their weddings. I think it's smart to insure your kids.

On top of all that- it breaks my heart in a million pieces to see families have to hold garage sales and car washes to bury their kids, when you could have bought a little policy for $20 a month. It's hard to grieve when you are trying to scrape up cash like that.

Buy your damn kids and grand kids life policies. It's worth it.

Considering how the costs of cars seem to be going up you might be closer on the pay for some of the books in college part assuming they can afford to even go to college.... Sorry I have 3 young kids and get real depressed when I look at the graphs for college costs 11 to 21 years from now.

 

[WinoBlues]

First, I have large policies on my three youngest.

I offer child riders on all parent policies. Yes, I have written many child policies and child riders. To not offer it I believe is a disservice to my clients.

Youngest claim I have paid was 16 days old, Less than 12 hours after writing the policy. I have converted a child policy at 5 times the original face on a comatose client and converted a male child policy to a female adult policy. I have a child rider in place now on a 21 year old that is in a vegetative state that will convert up to $100,000.00 at their age 25.

If the father is the beneficiary and is found guilty of his son's murder I do not believe he will be paid the benefits. Now will the contingent? Not sure, I have a call into the head claims person at one of my companies asking that.

Also paid on a child policy where the proceeds not only helped the grieving parents with income while they grieved. It also helped defray some of the legal fees from the accident that killed their son. He was a drunk driver, the accident killed three. Have also written large term cases on kids on a path to Med school where the parents cosigned the student loans.

 

[simpleguy]

It should be a crime to only have $27,000 death benefit on TWO policies for YOUR child.

 

[paige23]

I agree. The amount the parents should have, should be a good sized face amount, unless they are uninsurable. I add child riders to all my policies, but they usually cap out at around $25,000.

If setting up separate WL policies on children, the parents should be maximum funding their own policies first.

***

This story is more about the declining moral standards in America, than it is about the fact that there is life insurance on a child. Life insurance is good in a moral society that wouldn't seek out to kill a child to collect. Without morality, then life insurance is seen as an incentive to do harm to another.

Anybody remember Scott Peterson 10 years ago and the $250,000 insurance policy he had on his wife?

It is a very sickening commentary on the moral decline of this country. I am very saddened by this event and I so hope the mom had nothing to do with it but it does not appear that way.
None the less, I like the fact that parents can protect the children's future insurability as well.

 

[dobi]

It broke my heart and made me absolutely furious that someone would do this. I have policies on my youngest and my grandaughter. The oldest two boys have their own. Which by the way did not come to their mother to help! I have never handed the check to a family that lost a child, I can only imagine how wrenching that would be.

 

[WinoBlues]

It broke my heart and made me absolutely furious that someone would do this. I have policies on my youngest and my grandaughter. The oldest two boys have their own. Which by the way did not come to their mother to help! I have never handed the check to a family that lost a child, I can only imagine how wrenching that would be.

I have and broke down with them filling out the claim forms. Rough. Have one client that we finally did the claim a year or so ago. Ten years after his daughter died. Just could not handle doing it.

 

[yorkriver1]

This can be an old story with a long history: Why we have the contestable period, and voiding contracts purchased or claimed with criminal intent. As a historical perspective, the reason we have insurable interest rules about who can buy insurance on others is in part from events in England in the 1700's. Life policies had no such restrictions then. Some of them became hit contracts. One could buy life insurance on a stranger, and that poor soul might meet a mysteriously sudden end. The story isn't told in this link, but the year of the laws is mentioned: Insurable interest - Wikipedia, the free encyclopedia

Here is a paragraph about the events: "By the mid-18th century, purchasing policies on strangers had become a popular form of gambling. Investors often placed their money into "dead pools" insuring the lives of well-known public figures, particularly those with such problems as gout or alcoholism, or those who were likely to be challenged by political enemies and engaged in duels. Such "investors" would often offer targeted insureds lavish dinners and "a drink or two on me"--or would use other means to assure the certainty and accelerate the realization of their investment." Article is about STOLI, but the idea of life insurance for profit is the theme. Stranger-Owned Life Insurance (SOLI"): Killing the Goose That Lays Golden Eggs!" | Planned Giving Design Center
We can be a brutal species, in need of correct bringing up and good laws.

 

[Alston]

Nothing wrong with life insurance on children. Just make sure the parents have it first.

$27,000 for a doesn't seem the least bit excessive to me in 2014. The family has to pay for a funeral if the child dies. Even if you didn't need to deduct the cost of final expenses from the DB, the beneficiary isn't going to wind up with a life-changing boat load of cash.

Life insurance is no longer my primary market, but it was in the 1980s when I was a captive agent for MetLife. Even then a $25,000 or $50,000 DB for a child was very common.

In the late 80s, the minimum face amount for a primary insured on a MetLife UL was $50,000 regardless of the age of the PI. The minimum for a WL was $10,000, but the premiums per thousand for children is so low that my clients rarely considered DBs lower than $25,000.

Insurance carriers know where the line is drawn regarding moral hazards. They sell $25,000 policies insuring children all day, every day. If this were enough to incent all but the most reprobate of parents to commit prolicide, they wouldn't sell policies with such "high" face amounts.

(For any non-insurance agents reading this: Life insurance underwriters will want to know about other policies you have including those with other carriers. They aren't just concerned about the amount you are currently applying for.)

Anyone who thinks that $27,000 is an excessive DB for a child's policy hasn't done the math. Funerals cost and when you factor in inflation they may cost more than the face amount before the child reaches the age of maturity.

Anyone who thinks that a $250,000 DB is too much for an adult is similarly math challenged. If your wife dies and she made $50,000 a year, a $250,000 DB replaces only five years of her income. FYI: she will be dead for longer than five years.

The typical adult with a young child isn't over insured even with $1,000,000 of life insurance IMO.

However, $250,000 on a kid would make me a little nervous unless the child earned an income.

I have sold life insurance policies for children, but usually as a rider on their parents' policy. I have usually been able to convince parents that it was more important to insure themselves than their children. I've even been able to convince grandparents to insure their child instead of their grandchildren.

The line I use is: "The death of a child is a tragedy in every since of the word except a financial one. However, if a parent dies the family loses his or her income forever." Then we start to talk about much the loss of a parent would impact the family and what we can do to reduce that financial impact.

 

[Cash]

Considering how the costs of cars seem to be going up you might be closer on the pay for some of the books in college part assuming they can afford to even go to college.... Sorry I have 3 young kids and get real depressed when I look at the graphs for college costs 11 to 21 years from now.

I highly doubt college will cost more in 11 years than it does today. Sooner or later kids will not be able to take on more debt and the price will drop dramatically, just like when homeowners couldn't take on more debt. Not to mention online schooling and what it will do to the price of college.

 

[TeePee]

I am NOT live licensed but I always mention kids when working with my customers to get life appointments for my specialist.

Have also written large term cases on kids on a path to Med school where the parents cosigned the student loans.

One of my insureds had a daughter in a HUGE private college getting her PHD. Spring break before she graduated, she lost 2 sorority sisters in an auto accident while they were driving home. Not long after the parents had buried their daughters, the student loan companies were blowing up the parents phones wanting them to start the repayment.

None the less, I like the fact that parents can protect the children's future insurability as well.

How many children do you hear about or see that have cancer, diabetes, or other normal adult diseases? My coworker who is also my cousin took her then 2 yr old son for his yearly checkup. Everything was normal one minute and the next she finds out her 2 yr has a chronic blood disorder. He will probably never be able to get a preferred and likely not even a standard life policy.

I have $100K on my Stepdaughter. I need to up her coverage because she just turned 13 and I am likely to kill her soon . I also have life policies on my 2 Nieces and Nephew. And yes I have an insurable interest in their kiddos! Hell I need to make sure there is someone to take care of me when I get old.