How to Give the Gift of Insurance
As a retiree, you've likely spent a lifetime planning ahead by saving for the future, guarding your health, and building a legacy. But while gifts of cash or keepsakes are always appreciated, there’s another gift to consider that’s both practical and deeply meaningful. It is the gift of insurance.
Whether you're looking to support a grandchild's future, help your children insure their families, or make sure your legacy is handled smoothly, giving the gift of insurance may provide a resource that lasts well beyond the holiday season or a milestone birthday.
From life insurance to health plans to long-term care coverage, here's how retirees may use insurance to make a difference in their loved ones' lives, both today and for their future.
Why Insurance Makes a Meaningful Gift
Insurance is a valuable gift that helps loved ones manage risk and unexpected costs, plan for the future, pursue financial goals, and may help in times of crisis. While insurance might not come wrapped in a bow, it may be one of the most thoughtful and forward-thinking gifts you may give.
1. Life Insurance for Children or Grandchildren
Life insurance may not be something most people think about when it comes to younger family members, but starting early has some powerful advantages.
There are two main types of life insurance to consider: 1) whole life and 2) term life.
Whole life insurance offers lifelong coverage and builds cash value over time, while term life insurance does not build cash value and provides coverage for a set number of years.
Regardless of which type you choose, life insurance makes a good gift for a few reasons. First, it lets you lock in lower premiums while your loved one is young and healthy. It also may offer a financial cushion for their future family. Whole life insurance policies may build cash value, which the policyholders may borrow against for education, emergencies, or a down payment later in life.
You may either give a policy in full with a one-time premium payment or pay the premiums for a set number of years.
2. Health Insurance Premium Contributions
For loved ones who may not have access to affordable health insurance, like college students, part-time workers, or young adults just starting their careers, helping with health insurance costs may be a life-changing gift.
Options include paying premiums for an individual plan through the Marketplace; helping with out-of-pocket costs, co-pays, or deductibles; or assisting with COBRA coverage if they’ve recently lost a job.
Health insurance makes a great gift by helping provide essential insurance against medical debt and letting younger adults stay on top of preventive care. It may also ease financial pressure during uncertain life transitions.
3. Long-Term Care Insurance
If you have adult children who may eventually help care for you, or if you want to cover your independence, long-term care (LTC) insurance is a proactive and generous gift.
LTC insurance may cover home health care, assisted living facilities, nursing home care, and adult day care services. It may be a good gift because it helps with the emotional and financial burden on loved ones, ensures you receive the care you want, in the setting you prefer, and preserves your retirement savings and estate for your family.
Discuss long-term care needs with your family. Gifting this kind of insurance may open the door to important conversations about aging and legacy.
4. Homeowners or Renters Insurance for Young Adults
Young adults moving into their first apartment or home may not think about insurance until it’s too late. Gifting a renter’s or homeowner’s insurance policy may provide some support. This insurance may cover personal belongings in case of theft, fire, or damage. It may also offer liability insurance for accidents on the property.
This insurance may help encourage responsible financial habits early on. You may even combine it with a "new household" care package containing cleaning supplies, safety gear, or decorative items.
5. Auto Insurance Support
If you have a grandchild who’s a new driver or a child navigating tight finances, helping with auto insurance is both practical and appreciated. Some ways to give include covering part or all of their premium, helping them shop for more affordable policies, or giving a roadside assistance membership.
Auto insurance makes a good gift because it may help your loved ones stay safe and legal on the road and eliminate any temptation to skip coverage due to cost.
6. Education-Focused Insurance Products
Some insurance products are designed to help save for education while offering life insurance, especially for grandchildren. Options to explore include juvenile life insurance policies with cash value, 529 plans with special features, and life insurance policies that may be converted to help fund college expenses.
These products make a good gift by providing a safety net and a savings tool in one product. They may encourage long-term planning and educational goals, and create a financial head start with flexibility down the road.
7. Final Expense or Funeral Insurance
This may not be the most glamorous gift, but for retirees focused on legacy and reducing burdens on loved ones, final expense insurance is worth considering. This insurance may cover funeral and burial costs, outstanding medical bills, and probate or legal fees.
Purchasing this insurance may allow your family to focus on celebrating your life, rather than covering final costs. It may also ensure your wishes are honored without stress or financial strain. And it may complement estate planning and legacy conversations, allowing you to combine these topics into one family discussion.
Final Thoughts: The Gift That Keeps on Giving
Insurance may not be wrapped in shiny paper or topped with a bow, but it may be one of the most powerful, practical gifts you may give.
By helping your loved ones prepare for the unexpected, manage risk, or build their financial future, you’re offering them more than insurance coverage. You’re giving them the potential freedom to focus on what matters most. And gifting insurance is not something they may think about, but they may really enjoy having coverage for life's many challenges.
Talk to a financial professional to find insurance products that match your goals and your loved one’s future needs.
