IN FOCUS: Critical Illness for Kids

Grandparents find new way to spoil grandkids

Sep 23, 2015
It’s not an idea that comes naturally to most grandparents but it’s a gift more insurance advisors are promoting on behalf of parents too cash starved to make the purchase themselves.
“I’m not even selling it to parents; I’m selling it to grandparents. It’s a little nice savings in it. It’s like a life insurance policy. It basically pays for itself. Pay for 20 years and it’s done,” independent insurance broker Jerry Wiseblott told LHP recently. “The child gets the policy for the rest of their life going forward. That’s really the whole benefit. It’s there if somebody gets sick.”
While the gift from grandma and grandpa might have the grandchild’s name on the card it’s certainly just as big a deal for the parents who will be responsible for taking care of any of their children should they get sick. Depending how long an illness lasts it can be incredibly expensive for parents to take extended leave to care for a child especially dual-income middle-class families with little in the way of emergency savings.
“When a kid gets sick you’re forgetting one thing. Both parents are working full time. Who is going to look after this kid?” asks Wiseblott. “Now one of you is going to have to stop working. That could cost you somewhere between $50,000 and $100,000 per year.”
Life insurance is often referred to as a product bought as an expression of one’s love for another person; critical illness bought by grandparents for their grandchildren (and by extension their own kids) should also be considered in the same vain.
“I have a lot of clients that are becoming new grandparents and they’re looking for ways to help their grandchildren as well as a legacy thing. So the child will know this is what their grandparents gave them. When you talk to grandparents their love for the grandchildren is not anything you’ve ever seen,” Wiseblott says. “And grandparents have the money. They have a little more cash to play with than the parents. The parents are busy raising their children, putting money for university and this and that and the grandparents they have a different take on it.”

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