You want to give (your) children every opportunity. But, what does a child cost?

But what about our most important asset: our children? Do we not all too often lose sight of the importance of our children when we talk about insurance? How easily do we take out an Omnium insurance policy for our new car? That usually happens quite naturally. So we ask ourselves the question: why then, so to speak, do we never take out an "Omnium for parents"?

How can we secure our children's future with death cover insurance? That can be done very simply, and very cheaply. We explain this to you in precise detail in this article.

> "Compare the price of this coverage with the price of an (omnium) car insurance policy. Parents who know their priorities should therefore absolutely consider this type of insurance."

A child costs between 353 and 825 euro per month, depending on the age of the child. This was calculated by Gezinsbond in March 2022. This amount is the extra income that a two-person household, with a normal income, with one dependent child needs in order to maintain the same standard of living, compared to the same two-person household without a child. So a kind of yardstick for "What does a child cost?". Surprisingly, these figures do not yet take childcare, study costs, and medical costs into account. And inflation has not been factored in either. In practice, the real cost will lie a lot higher...

And if you add that up? How much would a child then cost from their birth to their 25th birthday?

NN calculated that for us. You will find the table below. NN assumes that you would need, on average, 157.000 euro over the first 24 years of the child's life. That is quite substantial. "Every child costs a house" is therefore roughly true, but it should in any case not be too big a house.

Source: NN, based on data from Gezinsbond, March 2022

How can you, as a parent, insure your child's future?

Fortunately, that is very simple through death cover insurance. You have the child take out a policy (of course you do this as parents in the child's name), with one of the parents as the insured, and at the same time the child as the beneficiary. We call this an ABA-type death cover. If the parent dies, the child receives a one-time payment as indicated in the contract. The advantage of this insurance is that the payout is not taxed, and also does not fall into the estate. It is a so-called tax-neutral contract, which means you need to insure less.

How much should you then insure?

Life Experts has developed its own calculation model based on the above data, but with a number of corrections. We calculate it based on the age of the child, on expected inflation, and on any additional study costs. This results in an exact death capital to be insured per month up to the child's 25th year of life. This way, as parents, you have complete peace of mind knowing that the death cover will be high enough to guarantee your child's standard of living if you are no longer there.

An example. The capital needed to provide for living expenses up to age 25, for a baby of 9 months, taking into account inflation of 3% and an additional cost on top of the Gezinsbond figures of 20%, comes to 284.000 euro net. An example of such a calculation can be found here.

Screenshot of the Life Experts calculation model for a baby of 8 months up to their 25th year. First 9 months.

You will notice that the capital decreases over time. Almost like with credit balance insurance. That makes sense, because we calculate the cost for the child up to their 25th year of life. The older the child gets, the higher the monthly cost of the child on the one hand, but also the shorter the period remaining until the 25th year of life. And so the monthly amount to be insured decreases gradually.

What does such insurance cost?

And now comes perhaps the most surprising part of this article: the price. In the case above, the dad was in his early thirties. And these were the premiums we obtained in a first round with one insurer:

Indicative monthly premium: insured is in their early thirties, for the capitals mentioned above.

You are reading this correctly: insuring the dad in the event of death for an initial capital of 184.000 euro, a decreasing capital, costs here only 14 euro per month. And moreover, this premium decreases noticeably over time. It goes without saying that this type of policy is very cheap. Compare the price of this coverage with the price of an (omnium) car insurance policy? Parents who know their priorities should therefore absolutely consider this type of insurance.

Would you like to read more about death cover insurance?

Then check our section here.

Would you like to know more about what death cover insurance can mean for you and your family?

Then get in touch with one of our Life Experts.

Disclaimer: the rates and examples in this article are informative, indicative, and not binding. They do not form part of any insurance proposal or offer, and no rights can be derived from them. Death cover insurance is subject to medical and financial acceptance by the insurer.