I would say that it's because it's close to Halloween, but I think the real reason is because it's the time of year when I need to make my work-related insurance choices for 2006.
Through work, I can get $X per child of child term life insurance for 2006 for a small payroll deduction. To "break even" for one person, he or she would have to have a one-in-whatever chance of dying during the year. But, in my case I have more than one kid. So the odds make it even more likely for it to be a financial benefit.
Someone needs to do these calculations, or there could be no insurance industry. But I hate doing it for my own family.
Maybe I'm approaching it wrong. I'm not really considering financial hardship should a child die -- I'm thinking of it more like an investment or even a lottery ticket. What are the odds of hitting the jackpot or striking it rich or whatever? Yuck.
3 comments:
I only purchase insurance where there is a case for financial hardship for surviving family members. If no such hardship would exist, I don't buy insurance. If such a hardship would exist, I get enough insurance to mitigate that hardship.
For example, if something happens to me, my family will get enough money so that my wife can continue to stay home with the kids until they are much older, and will not have any significant financial issues remaining in our current home, funding their post-secondary education, etc.
If something happens to my wife, there is enough insurance money to ensure that I could take an extended leave from work to care for the kids, and later afford supplemental child care once the kids are older.
Basing all my decisions on this type of criteria ensures my peace of mind.
Anshu
I'm with Anshu. I wouldn't bother taking out any cover (even if it was a great deal). If you were prepared to sacrifice a small amount of dollars for life insurance on the kids, I would instead just add that amount to your personal life insurance - after all, you are the major breadwinner! We get this automatically via work (it's pretty reasonable) so I've never had to make these sort of decisions before (having no kids makes things simpler also). I guess the only quandry for me is: Is the amount enough, and should I take out separate insuance to cover any "gap".
I see what you mean, it's still awful to have to put odds and dollars up against your kids.
When my sisters and I were kids, my parents purchased life insurance on us, but I think they thought of it more as having something there when we became adults, not knowing for sure what coverage we would have from our employers. I still have the coverage, and I have paid the premia since I got out of college. I have no idea what the coverage would pay. Of course, I get the standard coverage from my employer. I've never really thought much about life insurance by being single with no dependents.
But I agree with you. I'd hate the thought of trying to figure the odds of one of my (non-existent) children's dying. Here's hoping all of your kids live a full, healthy life!
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