We received a pamphlet in the mail for this Gerber Life Grow-Up Plan life insurance (https://www.gerberlife.com/child-life-insurance/grow-up-plan). Basically it is whole life insurance. The earlier you start a policy, the lower the monthly premium. (For example, if your child is one year old you will pay $3.40/month for $5k coverage. If they're two you pay $3.50/month, etc.)
Our son is one is and the only life insurance coverage he has right now is Dependent coverage from my employer which is $2,000.
My wife wanted me to ask around about this. Has anyone done whole life insurance for their child (through Gerber or not)? One interesting thing about this sort of insurance is that when the child turns 18 the kid has the option to continue coverage, buy more, or turn in the policy and get its cash value.
For what they're charging you, it's an utter waste of money. Go look at any third party death statistics for the US - children between the ages of 1 and 18 really just don't die very often. As a quick check, Social Security says that out of 100,000 baby boys, 98,974 will be alive at age 18. For girls, the number alive at 18 is even higher.
And this is across the entire US, which includes people who live in inner cities and have to deal with gang violence, and people who for whatever reason can't or don't seek proper medical care, and people who don't put their kids in car seats or teach them to swim or not drink and drive. I think it also includes a lot of kids who are born with serious health issues, like heart defects or genetic abnormalities that your kid probably doesn't have and Gerber probably excludes from coverage anyway.
If you and your wife put your kid in a proper car seat, teach them to swim and/or put proper safeguards in place if you have a pool or hot tub at your place, and you seek proper medical care for your kid, then your particular kid's life expectancy is even higher.
On the other hand, that $3.40 a month over those 18 years is $734.40, for which, if your kid is one of the really unlucky 1% (or probably less), then you get $5K. (If you want to dial it up to the $35K, then I'm betting that the premium rises proportionally anyways, so the analysis is the same.)
And that's ignoring what that $734.40 could have done in the market. Even at 5% growth, which you could get with a common sense 60/40 fund, you'd end up with $1,289.78.
So do you want to pay $3.40 every month for a 1% chance of $5K, or a 100% chance of ending up with $1,289.78?
As for the "interesting thing" - of course Gerber is going to give you the "opportunity" to give them more of your money for subpar insurance and subpar returns! It's an opportunity in the same way Tom Sawyer offered his friends the opportunity to whitewash the fence (
https://www.pbs.org/kenburns/mark-twain/tom-sawyer if you're not familiar with the story).