Life Insurance for Teenagers [2024]

Adults often purchase life insurance, including life insurance for parents, to protect their loved ones financially after they pass. Perhaps you have a child or an elderly parent who depends on your income to survive. If you pass away, your life insurance, specifically designed for parents, could provide your child or parent with a financial safety net so they can continue to cover monthly bills, your funeral costs, and more.

You can also consider getting life insurance for parents.

Rarely are parents financially dependent on their teenagers, so getting a life insurance policy may not make sense. However, purchasing term life insurance for your teenager could be beneficial. 

We’ll discuss life insurance for teenagers and discuss why your teenager may need term life insurance. 

Does my teenager qualify for term life insurance? 

Many insurance companies do not allow term life to be purchased by someone under the age of 18. And if you purchase insurance for your child before the age of 18, they are only eligible for whole life insurance unless you secure coverage for them through a rider. Once they turn 18, they can apply for term life if they do not have a whole life policy. 

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Why would a teenager need term life insurance? 

Although teenagers do not have the same financial responsibilities as their parents, a term life insurance policy has its benefits. 

Here are common reasons why a teenager would need term life insurance. 

Guaranteed Insurability

Term life insurance can typically be converted into whole life insurance. Purchasing a term life insurance policy for your teenager offers them guaranteed insurability, which ensures them future coverage regardless of any health conditions. 

If they wish to purchase whole life insurance, they can easily convert their policy and not have to complete a medical exam. And with whole life insurance, they have access to higher coverage levels, which would be ideal if they have a spouse and/or children who might be financially dependent on them.

Funeral Expenses

Life insurance benefits can be used to cover funeral expenses for your teenager. The average funeral costs about $8,000, and with a life insurance policy, you won’t have to pay for the large expense out of pocket.

Student Loans

If your teenager is in college and has taken out student loans to cover the cost, the money will need to be repaid. Federal loans are discharged if the borrower passes away, but this is not the case for private student loans. And if you have cosigned the private loan, you will be solely responsible for repayment. Ideally, if you agree to cosign a private student loan for your child, the benefit amount will include the total cost of the loan in case your teenager passes away. 

Grief Counseling or Therapy

Losing a loved one can be overwhelming. It is not uncommon for people to seek help as they grieve and try to get their life back on track after losing a family member. If you lose your child, you may need counseling or therapy to help you through this time. The cost of grief counseling or therapy varies, but it would be wise to factor in this cost when determining the coverage amount for your teen’s term life insurance policy. 

How much term life insurance coverage should I purchase for my teenager? 

How will your teenager’s death impact you financially? When people purchase life insurance, their death will likely impact their beneficiary somehow, which is why they choose a certain coverage amount. When you are trying to determine how much life insurance coverage to purchase for your teen, you’ll want to consider why you are getting life insurance in the first place. 

As mentioned, life insurance benefits can be used to cover various expenses, and if your teenager passes away, you want to make sure you can cover the cost of medical bills, funeral expenses, student loans and more. 

Pros and Cons of Purchasing Term Life Insurance for Your Teenager 

It may not be clear whether you should purchase a term life insurance policy for your teenager. Even if you don’t purchase a policy today, consider the pros and cons to help you decide. 

Pros	Cons
Guaranteed insurability	No cash value
Death benefit can be used to cover funeral expenses	Death benefit may be limited
Cheaper than whole life insurance
Convertible, depending on the insurance company

As you can see, there are more pros than cons when it comes to considering term life insurance for your teenager.

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Case Studies: Life Insurance for Teenagers

Case Study 1: Sarah’s Guaranteed Insurability

Sarah’s parents decided to purchase term life insurance for her when she turned 18. They understood the benefits of securing coverage at an early age, including guaranteed insurability. This meant that Sarah could convert her term life insurance into whole life insurance later in life without having to undergo a medical exam.

Sarah’s parents wanted to provide her with a financial safety net and the opportunity to access higher coverage levels if needed in the future.

Case Study 2: Michael’s Funeral Expenses

Michael’s parents recognized the importance of being prepared for unexpected circumstances. They purchased a term life insurance policy for him to ensure that funeral expenses would be covered in case of his untimely passing.

They understood that the average funeral costs and wanted to alleviate any financial burden on their family during such a difficult time.

Case Study 3: Emma’s Student Loans

Emma was a college student who relied on private student loans to finance her education. Her parents decided to purchase term life insurance for her to protect themselves from potential financial liability.

They understood that in the unfortunate event of Emma’s passing, they would be responsible for repaying the private student loans they had cosigned.

Bottom Line: Should you purchase term life insurance for your teenager? 

People don’t often question purchasing life insurance when they have financial dependents, but there are also good reasons for purchasing life insurance for your teenager. Even though you don’t rely on them to help pay the bills, their death can still impact you in a number of ways, including financially. 

With a term life insurance policy, you can ensure that certain expenses are covered if your teenager passes away, and many feel that having this peace of mind is worth the cost of the policy.

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