True Story 

I have a 21-year-old son and a 17-year-old daughter, and I worry a lot about the future for these kids, like most parents. Between the cost of education, housing, transportation, I want to be able to give them a hand. I want to do this within reason and not at the expense of my retirement. 

To this end, I gave my kids two gifts a few years ago that I believe give them a good foundation to start from - one was Participating Life Insurance, and the second was Critical Illness coverage, and I’ll explain why I did so.

While I was able to give my son half the money for his first car, I don’t know if I’ll be around or in a position to help with other big expenses (for example, a down payment on his first home when that time comes). I figured the next best thing that I could do was to give him a leg up with a participating life insurance policy. Here's why:

  1. Pay your premiums and your policy’s cash value grows tax-free, within limits.
  2. Your payments go into the participating account that is professionally managed.
  3. That money is used to pay for expenses, taxes, insurance claims and other items.
  4. You may receive dividends based on the participating account’s performance.
  5. You can take your dividend as cash, buy more insurance or pay for your existing coverage.
  6. You can access the policy’s cash value in several ways, borrow from your policy, use it as collateral for a third-party loan or withdraw cash. (This may affect your coverage, and you may have to pay taxes.
  7. I have guaranteed his insurability regardless of any health conditions that may arrive later on.


The second gift was critical illness (CI) coverage with a 10-year term. CI coverage can give you a tax-free payment if you’re diagnosed with a serious condition, like cancer, heart attack or stroke. I added a return of premium rider to the policy so that if a claim is never made and the policy expires all the premiums could be returned, so that’s another nice bonus. In our kid's policy, several different health conditions are covered with plus we get access to the top 5% of medical specialists in each field thru Best Doctors.

I’m paying for those policies for both of my kids, and because of their ages it’s quite reasonable, at approximately $2 a day for each I get some serious peace of mind and they get the protection that they will actually benefit from if needed.

That's a great start in my mind.