Wednesday, October 19, 2011

Life Insurance for College Students

It is not something that comes up often because college age adults generally have other things on their mind besides insurance. Some people might say it is a waste of money to insure someone who doesn't have many responsibilities outside of getting an education.

Less than half of all college students have insurance policies. The rate was under 40% at the turn of the last century and hasn't climbed more than a few points since. Many parents have a small life insurance policy on their children while they grow up, but this often ends when they go to college and a coverage void is left.

One reason why life insurance makes sense for college students is that it provides compensation to the parents for the huge expenses they pay out for a young adult to pursue an education beyond high school.

It is not that a parent wants to receive money in the event of the death of a child, but there is often a hardship pressed upon those who have provided for a child for all of their young life.

Debts might be outstanding that will still need to be paid even if something were to happen to the student. A college loan, for example, is often co-signed by a parent, and the money is expected to be paid back even if the student dies.

This sounds harsh, but it is the way businesses are run. If a family gets a loan to pay for college, a life insurance policy can help ease that financial burden as well as others such as burial expenses and/or auto loans.

Another reason for college students to consider coverage is that the cost is very low for term life insurance for a person at that age that is in good health. Life insurance is recommended after college anyway, so beginning a few years early is not a bad idea. It will often save money over the duration of a 30-year term life insurance policy to begin the policy early.

There are also college students who are married while they are attending school. Graduate students are often married and even have children. All the primary reasons for having life insurance are already in place for these students.

Forgetting about life insurance for students can flow over into the first years of employment, marriage, and on into life. Something that costs so little at an early age and provides financial security for loved ones should not be considered lightly.

By: Dwayne
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