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Single parents: Your children’s security is more affordable than you think

Ensure your children realize their hopes and dreams—for less than the cost of a night out.

It’s a fine balance between burden and blessing, and sometimes, as a single parent, it feels as if you are carrying the world on your shoulders: Nearly all single parents agree that raising their children alone is both a joy and a challenge. One thing remains true for many single parents, however: Your children depend on you and only you. So what would happen to them if you weren’t around for them tomorrow?

It may seem a frightening question, but a recent 2012 white paper from Genworth, “Getting Over the Gap: Insights on Life Insurance Coverage in the U.S.,”1 reveals an even more frightening truth: unmarried parents are significantly less likely to have life insurance than their married counterparts, at all income levels, even though they have a clear need for coverage.

Why? Some parents may feel that insurance protection is unaffordable; others may just not know where to start. And they’re not alone. “It seems to me,” mused Agent Gary Chipurnoi, LUTCF, Greater New York Office, “that for many of my clients, no one actually took the time to sit them down and explain the dangers of being uninsured and the potentially negative impact it can have on their children’s lives.”

Another contributing factor is that many single parents are unaware of the importance of, or have difficulty finding, the resources to create wills, trusts, and other necessary documents that can help define the future for surviving children. “Growing up, I certainly don’t remember anyone explaining the importance of them to me,” says Chipurnoi. Today, as part of his services, he puts his clients and prospects in touch with trusted professionals who can provide those services.

Consider these additional facts from the study:

  • Unmarried fathers are the least likely to have life insurance of any group in the study.
  • 59% of unmarried mothers lack life insurance vs 43% of married mothers.
  • 60% of unmarried fathers with household incomes between $50,000 and $250,000 have no life insurance vs 27% of married fathers.
  • 75% of adults with one or two children in their household and with incomes below $50,000 have no life insurance.
  • Even as income increases, 44% of households with one to two children are still uninsured.
  • 64% of adults in households earning less than $50,000 with more than five children have no life insurance coverage.
  • 49% of adults earning between $50,000 and $250,000 with more than five children remain uninsured.

Keep in mind, too, these figures do not even account for the single parents who may own some life insurance, but are woefully under insured.

Protection can be more affordable than most parents think, however. Term insurance is the simplest form of life insurance. Term insurance provides affordable protection for a specific period of time at a scheduled premium level. You choose a coverage level, a term (usually 5, 10, 15, or 20 years) and name a beneficiary, that is, the person you want to receive the benefit if you die. If you die while your term life insurance policy is in force, the death benefit is paid to the beneficiary you chose.

Many term policies offer a conversion privilege that can be used to purchase a permanent life insurance policy which builds cash value and may earn dividends (which are not guaranteed). For example: A single mother can purchase from New York Life Insurance Company a $250,000 10 Year Level Term policy2 for herself and $25,000 term riders for up to three male children—all for less than $19 a month. That’s less than the cost of two movie tickets!

And, for a little under an additional $10 more a month, that same parent could double her protection to $500,000 in term coverage3 with $25,000 term riders for her children—about the cost of dinner at the local pizzeria.

Still think security is unaffordable? Think of all the things that your legacy would enable your children to do, should they be in someone else’s care: pay for tuition at a private school, pay for a college education, put a down payment on a house, obtain medical care, take music and art lessons, pay for their wedding…the list goes on and on.

Being uninsured can have a devastating effect on children’s’ lives, particularly on those of single parents. It’s imperative that parents take the proper steps now to ensure their children are protected—and will be able to realize their dreams and goals far into the future.

We’re here to help. Your local New York Life Agent can sit down with you and help you determine which policy is right for your family’s needs, as well as your budget. In addition, he or she can refer you to other trusted professionals in your community who will help ensure you have the proper paperwork in place. This includes wills, trusts, and other legal documents that will ensure as smooth a transition as possible for your beneficiaries.

For a no-cost, no-obligation consultation at a time that works with your busy schedule, fill out the “Consult an Agent” form at the top of the page.

1 Genworth 2012 LifeJacket Study,“Getting Over the Gap. Insights on Life Insurance Coverage in the U.S.,” https://www.genworth.com/dam/Americas/US/PDFs/Consumer/Product/LTC/140122D.pdf
2 Based on Level Premium Convertible Term: 10 Year Level Premiums for a Female, Issue Age 35, Select Preferred, with $25,000 Level Term 5 riders covering three male juveniles ages 5, 8, and 11 (check-o-matic premium). Level Premium Convertible Term: 10 Year Level Premium features a level premium guarantee for the first ten policy years of the policy. Beginning in year 11, premiums increase annually. Level Term 5 riders feature a level premium guarantee for the first five years of the policy. Beginning in year six, rider premiums will increase annually. The rate is subject to change. Other risk classes are also available. Life insurance applications are subject to underwriting.
3 Based on Level Premium Convertible Term: 10 Year Level Premiums for a Female, Issue Age 35, Select Preferred, with $25,000 Level Term 5 riders covering three male juveniles ages 5, 8, and 11 (check-o-matic premium). The rate is subject to change.

In Oregon, the Level Premium Convertible Term policy form number is 210-60.27. The Level Premium Convertible Term 5 Rider form number is 210-450.

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