What if I Want to Buy Life Insurance for My Parents?
There’s a candid conversation we all have to have with our parents at some point in our lives regarding things like long term care, overall finances, outstanding debt, and the amount of savings they have. It may feel awkward, but it’s best to have this conversation sooner rather than later, particularly to find out if they have life insurance. Getting life insurance early can help provide for your parents if they face a chronic or critical illness or injury and waiting too long can mean it’s no longer possible.
If they don’t have any coverage, you might find yourself wondering if you can buy a policy for them. Luckily, the short answer is yes; however, there are a few factors you should take into consideration before settling on a policy.
Consent and Insurable Interest
Obtaining the consent of the insured is simple enough. All you’ll need is their signature on the application, and you’ll be the owner of the policy and able to make premium payments on their behalf.
Insurable interest means proving that the insured’s death will have a financial impact on you. If it would cause you financial loss, then you have an insurable interest—being the child of the insured fulfills this requirement most of the time.1
How to Determine Coverage Goals