Purpose

• The purpose of a child term rider is to provide life insurance on the life of your child or children. Term insurance only lasts for a set number of years. So, when your base policy contract expires, so will the term rider. The rider's purpose, in keeping with your base policy, is to provide only temporary insurance coverage for your child.
  
  

Significance

• Your insurance company may place a limit on the number of years that you can hold your contract's term rider. Your term rider for your child may expire at your child's 18th birthday, for example, regardless of whether your policy is due to expire. After this point, the insurer may offer you the option to convert the policy to a permanent policy.
  
  

Benefit

• The benefit of a child term rider is that you insure your child under your policy. This policy may be convertible to a permanent policy. You take advantage of your child's younger age when you might not be able to afford higher premiums for permanent coverage. Because life insurance eligibility is driven by age, health and lifestyle at the time you take out the policy, your child benefits from the lowest possible premiums available to him the younger he is when you add that child rider.
  
  

Consideration

• While the child may not need life insurance, the idea is to get insurance at rates that are lower than they otherwise would be when the child will need life insurance. The convertibility of the child term rider to an individual term or permanent policy allows your child to keep the policy beyond what the rider provides. You should consider taking this long-term view of insurance for your child, because this helps them later in life when they may not be able to afford higher premiums or their health may make it difficult to purchase life insurance at reasonable rates (or at all).