Gerber Life Insurance?

[C_leen]

Hi,

Everyone here is right on the Gerber policy.

Check to see if you can access dependent insurance via work. I was able to get a $4k policy on my kid for a whopping 50 cents a month. With the cost of funerals today, it wouldn't cover everything I suppose, but it would be something. I just checked my work benefits and $4k was the max.

Be well!

'leen

 

[4luv2cdisney]

Gerber:
I remember forgetting to pay the premium last year or the year before and Gerber sent me a notice with the cash value of the policy. I had paid approximately $900 over about 10 years for a 15000 policy and it had a cash value of almost $800. That doesn't seem to be such a rip off to me. I realize I could have invested it, earned interest, etc. I've wasted $100 on worse things! I'm assuming, a rider on a term policy wouldn't guarantee any future coverage and would have cost me close to the same.

Whole life:
Same thing for my policy. I checked the cash value last year and it was about equal to what I'd paid into it since I had purchased it. So, pretty much free.

My husband has a term policy. It has cost us thousands over the years and has no cash value.

I'm really confused. I will continue to watch the cash values, and if the fees start eating the value, I will move things around I guess. For now, it doesn't seem like such a bad decision.

 

[eeyorethegreat]

So how do you find out what each policy is worth? Is it listed anywhere on the online account? Obviously calling them but I suspect you would have to listen to a half hour fevered pitch about keeping the Gerber before you actually got to the value of the policy. I have often thought of cancelling their policies and investing it in another way. We only pay $32 each year per child (I have 4) since birth. I think it is the 10,000 of course it could be the 5,000 guess I need to go look. Shows you how informed I was when we purchased it and I just pay the bills now when they come in.

 

[angierae]

I'm going to disagree. I have polycystic kidney disease - I am not eligible for life insurance in the state of Michigan. If my parents hadn't cashed in the policy they got on me as a kid, I would STILL HAVE IT.

As it is right now, if I die, my family is out of luck. I am uninsurable, even though PKD is not likely to kill me.

I suggest getting these sorts of policies for your children (and my daughter has one, since she's got a 50% chance of being diagnosed with PKD herself) because if they get sick, they may never, ever be eligible again.

And let me tell you, I feel pretty guilty that when I die, my family will have nothing to use to take care of things.

 

[windycitymom]

The point everyone is making is - if you are going to insure your child, go with a "term insurance" policy NOT a whole life/universal insurance policy (like Gerber's). Whole life is a rip off and you will definately pay less with a term insurance policy!!!!!! Ask ANY financial planner and they will tell you - term life insurance is the way to go! Get a 20 year term policy if you want - but don't pay for whole life insurance.

 

[eeyorethegreat]

Also another consideration I was thinking about is what if I took that "cash value" and invested it in another way besides the premiums. This amount would not be touched but only added to. So obviously starting out this way you have less value if something terrible should happen but in the long run you could have more for which could be given to your child to either purchase their own well researched life insurance or for them to continue to invest. I guess here on the budget board people are looking to see what will be the best value and that can mean different things to different people. I am not against insurance on my child but I just wondered if there was a way to make it more valuable to them (rather than me).

Also to the lady who has the non profit to help families pay for a headstone, that is a very precious thing you are doing. My DD lost her best friend a couple years ago just shy of her 8th birthday. It took two years and a lot of "trouble" to finally get the headstone placed and then it wasn't even exactly what they were expecting.

 

[badiggio]

If you were to get the same amount of coverage from a whole life ,compared to a term policy,the whole life is quite a bit more expensive.What I've always told clients is ,take the term and invest the difference {what it would've cost you for whole life.yes whole life has a cash value,but you've paid for it in the premiums and you only get the cash value if you cancel your insurance.when you die ,the benefactor only gets the coverage amount ;the cash value is gone.With term you have the coverage AND your investment.
Once the facts are out,it's an easy decision.

 

[MrsPete]

Has no one considered insurance for their kids in case they are diagnosed with something at some point in their life and are then no longer qualified for life insurance?

Although Gerber promises they'll not drop the child if he should develop an illness, they don't say that they won't increase the premiums or decrease the coverage to the point that it's either unaffordable or useless.

General rule of thumb: When a product like this is as heavily advertised as Gerber is, you should be suspicious.

. . . I agree Gerber and other whole life policies aren't the way to go, but I see a lot of wisdom in getting a cheap term policy for children, or as another poster suggested, adding them as a rider to the parents term policies, especially if you don't have much in savings.

Lets say you can get a 20 year term policy on your child for $5 a month for $20k worth of coverage. In twenty years you'd spend $1200. If the worst happens and your child dies, you've got one less thing to worry about. If things turn out fine and you never need it, then you're out $1200. On balance, that doesn't sound like a bad deal to me.

Burial-only policies are widely available at much lower costs. For example, I have a small term life policy (I think it's $5,000 policy) for BOTH my kids through my employer, and it costs $1/month no matter how many kids I have. These things are super-cheap because the risk to the insurer is quite low; few children die. You can't be emotional about life insurance. It has to be a choice made with math in mind.

I'll have children in my home/at college for 25 years; I get 10 paychecks per year. So I'll spend $250/lifetime for that small policy. That small amount is worth it. The Gerber plan isn't.

The moral: Investigate your options before you buy!

 

[mjkacmom]

I'm going to disagree. I have polycystic kidney disease - I am not eligible for life insurance in the state of Michigan. If my parents hadn't cashed in the policy they got on me as a kid, I would STILL HAVE IT.

As it is right now, if I die, my family is out of luck. I am uninsurable, even though PKD is not likely to kill me.

I suggest getting these sorts of policies for your children (and my daughter has one, since she's got a 50% chance of being diagnosed with PKD herself) because if they get sick, they may never, ever be eligible again.

And let me tell you, I feel pretty guilty that when I die, my family will have nothing to use to take care of things.

But, if they had started a mutual fund for you, and spent the same amount as they put into whole life, your family would have a nice chunk of change right now, and a bigger one when you actually die (not knowing your age). I have $500,000 on me, and there is no way I could have a whole life policy with payout that high, but it's what our family needs.