Child life insurance is rarely worth it, except in select cases
Whole life policies are sometimes marketed to parents and grandparents as a way to set aside savings for a child’s future. However, we don’t recommend stand-alone whole life insurance as an approach to building a nest egg for a child or grandchild. Instead, put what you'd pay in premiums into a 529 plan or even a high-yield savings account.
Life insurance for children is only worth considering in a few specific situations, like when you’re dependent on your child’s income or concerned about their future insurability due to a health condition or high-risk career.
What is child life insurance?
Child life insurance covers the life of a minor and is typically purchased by a parent, guardian or grandparent.
Child life insurance can be purchased as a stand-alone life insurance policy, or families can add coverage to an adult’s policy through an add-on called a rider.
Child life insurance: Key facts
CostsNot the best savings strategy for a child’s needs.
BenefitsLocks in the ability to get coverage without a medical exam.
Who it's forFamilies where the child contributes significantly to household income.
How does child life insurance work?
In general, child life policies are whole life insurance — a type of permanent life insurance. This means coverage lasts for the child’s entire life, as long as the premiums are paid. Coverage amounts tend to be low, often under $50,000, and premiums are locked in, meaning they won’t go up.
One of the benefits of whole life insurance is that it builds cash value. A portion of the premium goes to the cash value, which earns interest slowly over time and eventually can be withdrawn or borrowed against.
At certain ages, such as 18 or 21, the child can take ownership of the policy and continue coverage, buy more or cancel the policy altogether.
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Should I buy life insurance for my child?
When deciding if child life insurance is right for your family, consider the answers to these questions.
Are you concerned about your child’s future insurability?
Child life insurance policies usually include a “guaranteed purchase option.” This means the child can buy additional coverage later without completing a life insurance medical exam.
The coverage available varies among policies, and the ability to buy more may be restricted to certain ages or life events like marriage. This feature can be useful if the child develops a chronic health condition such as diabetes, or chooses a risky career like becoming a firefighter that could raise their average cost of life insurance. However, healthy people in their 20s are likely to secure affordable rates.
🧐 The verdict: Unless you suspect your child will need to find life insurance with a pre-existing condition, a child life policy isn’t necessary and is unlikely to meet future life insurance needs.
Do you want to create a savings vehicle for your child?
Like most whole life policies, you can withdraw money from the cash value or borrow against a child’s life insurance policy. When the child reaches adulthood, they can surrender the policy and receive the funds in full. The cash value also grows tax-deferred, meaning you don’t pay taxes on the gains until you withdraw the cash. However, if you borrow a large amount from the policy, your child could end up owing income tax or the coverage could lapse.
🧐 The verdict: Because the cash value rate of whole life insurance can be modest and take time to grow, it’s generally not a good choice for building savings. If setting aside money for your child is your main goal, consider other types of investments and accounts that earn higher rates of interest first.
Are you worried about covering costs if the worst were to happen?
Losing a child is extremely tragic, and you may incur unexpected costs. Child life insurance policies pay out a lump sum in the event of a death and can be used for expenses like burial costs or grief counseling. It can also help cover the costs of running a business if you’re the owner and need to take time off.
But note that because it’s uncommon for a child to die in the U.S., according to data from the Centers for Disease Control and Prevention, the risk of going without coverage may not outweigh the cost of the policy.
🧐 The verdict: Think about setting up a rainy-day savings account with three to six months of income or adding coverage for your child to your own life insurance policy.
» MORE: Life insurance riders
When does it make sense to buy life insurance for a child?
Assess your budget and look at your own life insurance needs before buying a policy for your kids. In general, your own life insurance is more important than your child’s because it can help cover your family’s living costs or other expenses if you were to die.
✅ Do you rely financially on your child?
Consider a life insurance policy if your child is …
- An actor, model or social media influencer with substantial income.
- A teenager working part-time to help cover household expenses.
- Looking after younger siblings or offering help you’d need to outsource otherwise.
❌ Are you trying to set aside savings for your child?
Buying a child life insurance policy isn’t worth it if you want to …
- Invest and maximize savings for your child’s future needs.
- Set aside money for funeral expenses.
Best life insurance for children in 2026
Although we don’t recommend life insurance for children in most cases, you might still be interested in a policy.
Our list of the best life insurance for kids highlights companies that offer stand-alone life insurance policies for children — not just child term riders. We assessed age eligibility, coverage amounts available, and the ease of getting a quote or buying a policy. We also looked at additional benefits, like the ability to increase coverage when the child grows up.
All of the life insurance companies on this list scored at least 4.4 out of 5 stars with NerdWallet.
Insurer | NerdWallet rating | Coverage amounts | Issue ages |
American Family Best for flexible payments | $25,000 to $75,000 | 0 to 17 years old. | |
Mutual of Omaha Best for boosting coverage | $5,000 to $50,000 | 14 days to 17 years old. | |
Gerber Life Best for babies | $5,000 to $50,000 | 14 days to 17 years old. | |
Note: With some insurers, a newborn may need to reach a certain age, such as 14 days old, before becoming eligible for coverage. | |||
NerdWallet rates insurers at the company level, not the policy level. This means our star rating reflects the company as a whole, and not its child life insurance policy specifically. | |||
⭐ Where American Family stands out
AmFam’s DreamSecure Children’s Whole Life Insurance stands out for its payment options. You can choose a 10-year plan to pay off the policy sooner or a 20-year plan for lower monthly premiums. Regardless of which plan you pick, the premiums are locked in.
» Read the full review: American Family life insurance
⭐ Where Mutual of Omaha stands out
Mutual of Omaha’s Children’s Whole Life gives you the option to buy additional whole life coverage when the child is an adult and gets married, purchases a home or has a kid of their own. You can increase coverage during these milestones without the need for a medical exam. Mutual of Omaha also allows you to buy more coverage at specific birthdays: 25, 30, 35 and 40.
» Read the full review: Mutual of Omaha life insurance
⭐ Where Gerber Life stands out
One of the main draws of the Gerber Life Grow-Up Plan is that the face amount of the policies doubles when the insured child turns 18. For example, if you bought a $50,000 life insurance policy for a grandchild when they were two weeks old, that policy would be worth $100,000 when your grandchild turns 18 as long as you keep up with the premium payments.
» Read the full review: Gerber life insurance
Alternatives to life insurance policies for kids
Instead of buying a separate policy for a child, consider adding a child term rider to your own life insurance policy. This rider can cover multiple children, and pay out a small amount — such as $5,000 to $25,000 — if a child dies.
Keep in mind you’ll need to opt into this life insurance rider when you purchase your policy, but any children born or adopted after that time will typically be covered. This can be a helpful baby life insurance option for parents as newborns become eligible at birth.
Another option is to sign up for supplemental life insurance offered through your employer, especially if it’s free or low-cost. Some policies cover eligible dependents, like children. Speak to your benefits coordinator to find out if your workplace offers this coverage.
» MORE: Supplemental life insurance
Frequently Asked Questions
Is it normal for parents to buy child life insurance?
While it’s not unusual to buy a life insurance policy for a child, most parents don’t have life insurance coverage for their children. However, adding life insurance coverage for a child to an existing life insurance policy via a rider is simple and affordable for most families.
Can you gift a life insurance policy to your children or grandchildren?
Yes. You can give a life insurance policy as a gift by paying the premiums and then making arrangements to transfer the policy. Many children’s life insurance policies are set up in this way where ownership automatically transfers to the child on their 18th or 21st birthday. You’ll need to have the permission of the parents or legal guardians of the child you want to insure.
What happens to a child life insurance policy when the child turns 18?
For most child life insurance policies, the child becomes the owner of the policy when they turn 18. At that point, the insured young adult may have the option to convert the policy to permanent coverage and may even be allowed to add additional coverage without a medical exam.
Methodology
How we rate the best life insurance companies
✅ 445 life insurers reviewed
📝 210 policies assessed
🔢 1,515 data points analyzed
📊 Star rating categories
When NerdWallet evaluates life insurance companies, our editorial team considers the insurer's strengths and weaknesses, as well as the things that matter most to customers buying a long-term financial product. We then weigh these factors carefully:
💰 Financial strength (35%). We use AM Best ratings to confirm an insurer’s financial stability and ability to pay claims far into the future. The top life insurance companies have an exceptional financial strength rating of A+ or A++ (Superior).
🗣️ Consumer complaints (35%). Our top-rated life insurance companies have fewer than the expected number of complaints to state regulators over a three-year period, according to the National Association of Insurance Commissioners — so you can expect a smoother customer experience.
☎️ Consumer experience (20%). Insurers who allow consumers to contact them by email, phone and live chat earn the highest scores. The same goes for insurers who support online quotes, beneficiary changes and claims.
👀 Transparency (10%). Our methodology gives higher scores to transparent insurers who clearly display information about their policy options, coverage amounts and term lengths (if applicable) on their site.
⭐ What our star ratings mean
Companies with 5 stars are exceptional, with strong financials, diverse policy lineups and great reputations for customer service.
Companies with 4.5 stars are excellent, with solid financials and policy offerings, and good customer service track records.
Companies with 4.0 stars are good, and potentially great for people looking for niche coverage options.
Companies with 3.5 stars or fewer could do better in certain categories, like financial strength and customer complaints.
NerdWallet does not receive compensation for our star ratings or our reviews. Read more about our life insurance ratings methodology and editorial guidelines.
Article sources
NerdWallet writers are subject matter authorities who use primary, trustworthy sources to inform their work, including peer-reviewed studies, government websites, academic research and interviews with industry experts. All content is fact-checked for accuracy, timeliness and relevance. You can learn more about NerdWallet's high standards for journalism by reading our editorial guidelines.
- 1.CDC: National Center for Health Statistics. Child Health, Mortality. Accessed Jul 24, 2026.
