Life insurance
Coverage for children, and coverage for the parents they count on.
Whole life and indexed universal life are permanent life insurance. They are not investment accounts, and an illustration is not a promise.
Children's whole life, in plain language
A juvenile whole life policy insures a child and is often owned by a parent or grandparent, who is also the person paying the premium. The owner controls the policy while that ownership lasts. How and when ownership can change depends on the contract. An attorney can speak to your broader estate plan. We will not.
Premiums on many whole life policies are designed to stay level. Whether they do is a feature of the specific contract, not a slogan. Read the schedule.
Whole life may build cash value. If the policy is participating, the company may pay dividends. Dividends are not guaranteed. Cash value is not a bank balance. Loans and withdrawals reduce it and can cause a policy to lapse if they are not watched. Some contracts include guaranteed elements and non-guaranteed elements. We will say which is which, and we will not treat the non-guaranteed column as a future fact.
A child's policy does not replace income the household does not have from that child. It can be one piece of a longer plan. It is the wrong tool if the premium strains the budget that should be protecting a parent first.
Indexed universal life, without the fog
Indexed universal life (IUL) is also permanent life insurance. The company may credit interest using the movement of a market index as a measuring stick. You do not own the index, and you are not invested in it. There is no direct market account inside the policy.
Crediting methods usually include a cap, a participation rate, a spread, or some mix of those, plus a floor. A floor can limit index-linked interest from going below a stated level, often zero. Policy charges can still reduce cash value in a flat or down period. Caps limit the upside the illustration is allowed to show. Those settings can change when the contract says they can.
IUL premiums are flexible in ways whole life premiums often are not. Flexibility cuts both ways: underfunding can put the policy at risk later. An illustration that assumes a level crediting rate for decades is a hypothetical. It is not a forecast, and it is not a promise of cash value, income, or a premium that vanishes.
We will not describe IUL as a way to “capture market gains with no downside.” That sentence is not true in the way people hear it. Charges, caps, and the chance of lapse are part of the explanation, or we are not done explaining.
Parent coverage
If a parent dies, the household can lose the income, the caregiving, or both, that a children's savings plan depends on. Life insurance on the parent is the tool built for that gap. Term insurance and permanent insurance do different jobs and cost different amounts. We start from the gap, not from a product.
We will ask what you already own through work or an older policy before suggesting more. More coverage is not the goal. A benefit the family could actually keep, for a premium the budget can hold, is the goal.
Beneficiary designations should match what you think happens if you die. They are easy to leave stale. We will look at them with you. Updating a will or a trust is a lawyer's job.
We do not promise returns, account balances, cash values, or any other financial result.
Questions
Straight answers
Is a children's whole life policy an investment?
No. It is life insurance. It may build cash value, but it is not a bank account and not a mutual fund. Cash value is not guaranteed to reach any particular amount. Dividends, where a policy pays them, are not guaranteed.
What is IUL, in one breath?
Indexed universal life is permanent life insurance. The company may credit interest based on a market index, with caps, participation rates, and a floor. You are not invested in the index. Charges can reduce cash value. Any illustration is hypothetical.
Should we insure our child, ourselves, or both?
Often the parent's coverage matters first, because the household depends on that parent's income or care. A child's policy is a separate decision. We look at what you already have, and at the premium you can keep paying, before suggesting anything new.
Will you tell us what the policy will be worth later?
No. We will not promise a cash value, a return, or a balance at a future age. We can explain how a contract is designed and which parts of an illustration are hypothetical.
Do we have to buy something after the consultation?
No. The consultation is free. There is no obligation to apply for a policy or open an account.
Are you our tax advisor or our lawyer?
No. We do not provide tax or legal advice. Questions about deductions, gifts, custodial property, or estate documents belong with those professionals.
Who owns a policy on a child?
Often a parent or grandparent is the owner and the payer, and the child is the insured person. Ownership affects who controls the policy. We explain that before an application. How it should fit your estate is a legal question.
What does the consultation cost?
Nothing. It is a conversation about your family, what you already have, and which questions are actually yours to answer.
Tell us what you already own.
The useful conversation starts with the coverage and accounts already in the house, not with a product name.