How Much Does The Gerber Grow Up Plan Cost And Is It Worth It
The Gerber Grow Up Plan coverages range from $5,000 to $50,000, and the maximum death benefit is $100,000. Premiums never increase, and coverage never decreases. The policy lasts forever, as long as premiums are paid. The coverage automatically doubles when the insured child turns 18 years old. The cost of Gerber Grow Up Plan varies with average premiums ranging from as low as $13 a month to $21 a month for a $20,000 benefit, depending on the age of the insured. A $40,000 policy ranges from $25 a month for a newborn to $40 a month for a 14-year-old.
Gerber Life Insurance Overview
Recently awarded an A rating by AM Best and located on Forbes list of Americas Best Insurance Firms in 2021, Gerber Life Insurance is considered a reliable name with over 50 years in the industry and over $59 billion in life insurance policies in force as of December 2020.
As a member of Western & Southern Financial Group Inc., Gerber Life offers flexible policy options perfect for a growing family, particularly ones with young children. Gerber Life offers coverage that can expand as children become adults and even offers a college savings plan.
- Positive rating from AM BestAwarded an A rating by AM Best in December 2020.
- Convenient online policy management portalEasily manage your policy and pay your premiums through their online eService platform.
- Easily receive a free quoteConsumers can easily receive a free quote online or by calling Gerber Life directly.
- Large selection of policies availableChoose from a variety of plans and coverage types for children, adults, and seniors.
So What Exactly Is Cash Value
Its a feature of whole life insurance. The cash value of your policy is the accumulated amount of money that Gerber Life sets aside each time you pay your premium. That means that the longer you hold your policy, the longer the cash value builds. Best of all, the cash value of your policy as well as the policy never expires.
How can cash value be used?
When shopping for a life insurance policy, youll first want to figure out how much coverage youll need to ensure that your family has enough protection. Gerber Life Whole Life insurance offers coverage amounts from $50,000 to $300,000 with affordable monthly premium rates, so you can find a policy that fits your budget.
“Your policys cash value continues to accumulate as long as premiums are paid.”
Gerber Whole Life Insurance
Gerber Life also provides whole life insurance for adults, with policy death benefits ranging from $25,000 to $150,000. Gerbers whole life insurance is similar to their child insurance, in that it has level premiums and builds cash value. However, their adult policies also allow you to add a waiver of premium rider. This rider costs more but allows you the option to maintain coverage without paying premiums should you be totally disabled for more than 6 months.
Gerbers whole life insurance policies can be purchased without a medical exam, as long as you are under 51 and seeking less than $100,000 in coverage. If you arent in good health and dont need a large amount of coverage, Gerber Life is a fairly good alternative for simplified issue whole life insurance. Most insurers who sell such policies offer a maximum of $50,000 of whole life coverage without a medical exam. In addition, Gerbers rates are actually lower than those you might get with fully underwritten coverage, if you have a poor health rating.
However, you might be better off with a term life insurance policy. This option may be less costly, since whole life insurance is comparatively expensive. And, if youre not able to purchase as large a policy as you actually need, you can spend a lot of money on an insufficient solution.
Childrens Term Life Insurance Rider
The main financial expense incurred by the loss of a child is a funeral and burial costs. If you have a life insurance plan in place for yourself, you can generally add a child rider to your policy for less than what the Gerber Grow Up plan might cost. You can add a rider for a child, a stepchild or an adopted dependent who is at least 2 weeks old, up to 18 years of age.
Theres minimal underwriting involved, and life insurance medical exams are not required. You dont have to add the child rider to your policy until you have kids, and when you do add the rider, it covers all your children. Its an inexpensive option you can add a rider that gives you a $25,000 death benefit for as little as $11 per month.
One key drawback to adding a child rider instead of buying the Gerber Grow Up Plan is that most insurance companies will limit the term to $25,000 or less per child. While that is enough to cover the $7,640 funeral and burial costs the median cost, according to the National Funeral Directors Association it may not cover any medical expenses or replace income for a parent who needs to take time off to grieve.
Another factor to consider is the expense or limitations a child could face when it comes time to convert the rider to their own plan or to a permanent policy. The value of a policy that is converted can vary depending on different insurers and can range from $25,000 to five times the original amount, for a total of $100,000 in coverage.
What Kind Of Burial Policies And Final Expense Policies Should I Avoid
Most burial policies or final expense policies you see advertised on television or in magazines are sold as the no-brainer way to shop for this protection.
In reality, most of these policies rely on you having NO BRAIN to purchase them.
Just about everyone is eligible for immediate coverage and better pricing allowed by these heavily advertised policies that cost an arm and leg.
To make a long story short, it is better to shop for burial policies with a specialist in burial insurance, like FuneralFunds.com, than to sign up with a company that spends ba-zillions of dollars each month advertising on television and in magazines.
Gerber Life Additional Riders
Gerbers limited additional riders is another drawback of the insurer. Most insurers allow policyholders to purchase extra endorsements.
For example, an extra endorsement might enable you to add coverage. Another endorsement might allow you to add additional family members. Yet other endorsements might enable you to access death benefits early under certain conditions.
Gerber Life policies, however, only have one available rider. Accordingly, your ability to customize a Gerber policy is highly limited.
The only rider that Gerber Life offers is the guaranteed purchase option. Also, its only available for Gerber Life Grow Up plans.
With the Gerber Life Grow Up Plan guaranteed purchase rider, a covered child can buy additional coverage once they turn 21. The additional coverage is available at adult premium rates. Also, theres no medical exam required for the coverage.
Your child must purchase the coverage 90 days after turning 21. However, they can purchase up to 10 times more than the original coverage amount.
Still, Gerber limits the coverage amount to a maximum of $100,000. So the only positive aspect of the Gerber Life Grow Up Plan rider is that its free.
Should You Choose Gerber
Like any insurance policy, make sure you look at your options.
While the cash value accumulation on any of the policies wont make you rich or pay for your childs entire college education, its a forced way to save for your childs future .
Gerber Life offers low coverage options with fixed premiums, and more often than not without a medical exam.
If you wont qualify for other insurance policies or you want a simple policy that you can get online with little hassle, the Gerber Life insurance policy may be a suitable option.
However, its worth comparing the premiums and policies from at least three other companies just to be sure.
Are The Prices And Premiums Reasonable
Gerber Lifes maximum coverage for a term life policy is $150,000, which is lower than our usual test rate policy.
Geber does provide instant quoting; all you have to do is enter your state and a few basics, and youll be given a list of premium amounts for various coverage amounts.
For example: In California, a 30-year-old male- non-smoker can get $150,000 worth of coverage on a 30-year term plan for $37.64/month.
A whole life policy for the same person would cost $130.50 per month.
These premiums are not terribly expensive on a monthly basis, but they provide significantly less coverage amounts compared to other policies with similar premiums .
Since Gerber really pushes guarantee issue juvenile life insurance, we ran a quote on the Grow-Up Plan as well. For a 5-year-old boy at the maximum coverage level of $50,000, the monthly rate is $39.36. That coverage doubles to $100,000 at the age of 18 with no increase in premium.
A $100,000 whole life plan from Gerber for an 18-year-old male is quoted at $70 a month. Taking a look at these numbers, the Gerber Grow-Up Plan seems to offer an ok value in terms of whole life, giving the same amount of coverage for an 18-year-old male for half the price, and locking that price in for the rest of his life.
That said, a rider on an adult policy to cover children would generally still cost less than this policy.
Who Needs Life Insurance
The primary purpose of life insurance is to protect the insured’s family and dependents from financial calamity if he dies prematurely and his income is cut off. For example, a father and a mother earn $50,000 per year each and have two young children, both of whom they hope to send to college. The father dies in a car accident during a severe thunderstorm.
His wife and children are devastated emotionally, and the family income is cut in half. Now the mother has to pay for the house, car, food, clothing, and other necessities on her own, and she must also find a way to continue saving for her children’s education.
The father and the mother in the above scenario need life insurance. Why? Because the family depends on the parents’ income, the loss of which creates a severe financial hardship. Children are different. While they contribute many things to their families, money is almost never one of them and because of this fact, it may make little sense to pay to insure yourself against a doomsday scenario that does not even exist.
There is one financial cost incurred by parents who lose a child: funeral and burial expenses. If you have life insurance on yourself, you can almost always attach a small child rider to your own plan for a much lower rate than what the Gerber plan is likely to cost.
Gerber Life College Plan Performance Similar To Short
The performance of the Gerber Life College Plan is similar to the interest rates on current 1-year bank CDs, as reported by Bankrate.com.
The Gerber Life College Plan does lock in the earnings over a 10 to 20 year term. But, in a rising interest rate environment, one would expect a higher return on investment for a long-term investment. For example, the best interest rates on 5-year CDs, as reported by Bankrate.com, provide a higher return on investment than the Gerber Life College Plan.
Bank CDs also provide the benefit of FDIC insurance, which the Gerber Life College Plan does not.
Gerber Life Insurance Products
Gerber offers several life insurance policies that are designed to cover children, adults and seniors. The majority of Gerbers insurance offerings are a form of whole life insurance, and these are their best policies. They also provide term life insurance, although we would recommend other insurers over Gerber for term policies.
What Customers Are Saying
Most customers appreciate Gerbers simple application process and limited questions. They also like Gerbers low-cost premiums and extensive coverage options.
Many customers, however, dont care for the limited customer service hours, but state that Gerber offers quality customer care when they finally get through.
The Drawbacks Of Gerber Life Insurance
Here is where the benefits of Gerber Life insurance start looking less attractive.
Gerber Life insurance has a relatively low coverage amount. Most insurers provide $1 million or more in life insurance coverage. However, the maximum coverage with a Gerber term or whole life policy is only $300,000.
Also, Gerber Life charges more than most of its competitors. The monthly premiums for Gerber Life plans are high. If youre in exceptional health and have no problems taking a medical exam, its in your best interest to search elsewhere for better rates.
Also, not all Gerber Life insurance plans are available in every state. Therefore, based on where you live, you may have limited options if you seek coverage through the insurer.
How To Get A Quote From Gerber Life Insurance
You can contact Gerber life insurance by phone at 800-704-2180. Otherwise, you can start the quote process online by following these steps:
Child life offers guaranteed insurability, but it isnt the best investment
A childs life insurance policy may not give the best protection, even with a college savings feature. You may get a better investment return from a high-interest savings account or 529 plan. Plus, standard policies offer child riders that extend your benefits to your kids until theyre age 25. At that point, you often can convert them to individual policies. Its worth checking out life insurance with child riders to score the most value.
However, one of the main reasons parents consider a child life policy is to make sure their children have guaranteed insurability. That means your child can have coverage even if they develop a health condition later in life that makes them uninsurable.
Gerber Life Grow Up Plan Cost Comparison
Below is a table that shows you Gerber life grow up plan rates compared to what Mutual of Omaha charges for their infant life insurance.
Were using Mutual of Omahas rates because hands down they offer the best childrens whole life insurance on the market.
As you can see, Mutual of Omahas child coverage prices are significantly lower.
Boys and girls pay the same rate | Rates dont change | Coverage never expires
What Is Juvenile Life Insurance
Since the Gerber Grow-Up Plan, which is a juvenile life insurance policy, is one of the most popular products sold by Gerber, and since juvenile life is often misunderstood its worth taking a closer look at how they work, what value they offer, and how Gerbers policies stack up.
A juvenile life policy is simply a whole life insurance policy that insures the child, but is paid for and owned by the person who took it out usually a parent or guardian until the age of 21. Once the child is of age, they become the policy owner, and the policy stays in force as long as they pay the premiums. Whether the now-adult child pays or the parent continues to pay is up to the individual.
The main benefits of a juvenile life insurance product are a locked-in premium and the certainty of coverage for as long as the premiums are paid, regardless of changes in health status.
The Gerber plan adds an additional benefit, which states that the policy amount will double when the child turns 18 so that the insured is now paying the same amount for twice the coverage. Well take a look at how that works out premium-wise in the next section.
There is also a cash accumulation account, which can be borrowed against with interest if needed. Gerber promises that after 25 years, the cash value of the policy will be equal to or greater than the total amount of premiums paid over that timeframe.
There are a couple of things to consider before you buy a policy like the Gerber Grow-Up Plan.
What Is Guaranteed Issue
Guaranteed Issue Life Insurance is also known as no questions life insurance, guaranteed issue burial insurance, and guaranteed issue final expense insurance because it offers guaranteed coverage.
There arent any required questions or medical exams when you apply and most people qualify without any hassle.
Premiums are determined by gender, age, and location.
How Are The Gerber Life Insurance Companys Ratings And Reviews
Is Gerber Life Insurance worth it? Although Gerber Life Insurance is not Better Business Bureau accredited, they do have an A+ rating. There have been 79 complaints against the company in the past three years, with 21 of those closed in the past 12 months.
Normally guaranteed issue insurance providers focusing on life insurance do not get as many negative reviews and life insurance ratings or customer complaints as auto and home insurance companies, so the number of complaints does raise a bit of concern to see more than a few.
There are a few other reviews of Gerber Life around the various review sites, but even fewer that offer any real information.
Beyond that, there are a few typical insurance company complaints, but they are so few that its hard to see any real cause for concern.
Life Insurance Buying Guide
Before you start comparing companies, choose the type of life insurance you want, such as term or whole life. Decide which life insurance riders, if any, you want the policy to include. Calculate how much life insurance you need and how long you want the coverage to last. Check that the insurers youre considering offer the coverage youre looking for.
When comparing rates, be sure the quotes are for the same amount of coverage over the same period of time. Its also important to make sure the policys medical requirements match your needs. For example, if you want to skip the life insurance medical exam but dont mind answering health questions, confirm that the application process for each policy you’re comparing aligns with that.
Price may not be the biggest driver behind your decision to buy. Look at the number of consumer complaints each company receives, as high numbers can be a red flag about the quality of service.
How Does The Gerber Life Grow Up Plan Work
The policy is whole life which fortunately are very straightforward plans. Prices cannot increase, coverage is guaranteed to never decrease, policy wont expire due to age and it builds cash value indefinitely. At the end of the day, the policy will payout a tax free cash benefit to the beneficiaries. There are no restrictions how the money is used.
What Is The Best Life Insurance Company
There isnt one life insurance company that is the best for every individual. For example, Gerber insurance is a great company for child life insurance, but its not the best option for adults who want comprehensive coverage with multiple investing options. Choosing the right life insurance policy is important, so while youre shopping, consider what makes the most sense for your family, your lifestyle and your budget.
Financial Strength: Not Backed By Nestle
Gerber has received an A rating from AM Best, indicating that the company is relatively stable financially. Its worth noting that Gerber is owned by Western & Southern, which further adds to its financial strength. However, the company is not associated with the Gerber food maker Nestle, so customers cant depend on the financial strength of the giant Swiss food company. Still, the company has never defaulted on a payment.
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What Is Gerber Life Insurance For Children
Gerber, yes, a company that produces baby food, is also involved in financial services. In particular, it offers a form of life insurance for children called the Growing Up Plan. If youre a new parent, youve probably seen at least some ads for this insurance.
The Grow-Up® plan is a typical life insurance policy, which means it has the following features:
- You pay equal monthly fees as long as you have a life insurance policy.
- If the insured person dies, the insurance company pays the value of the policy .
- Over time, the policy creates cash value. You can borrow on cash value, use interest on cash value to pay premiums, or opt out of the policy in exchange for cash value. Well discuss more on the cash value concept later.
The plan also has a small return. When the insured person turns 18, the policy amount doubles . This makes it a little more valuable to the child. In addition, when a child turns 21, he or she automatically owns the policy.
Gerber Life Insurance Vs New York Life Insurance
New York Life Insurance is another company with a high customer satisfaction rating and has been an industry leader for 175 years. New York Life may be a better option for consumers who want to sit down with a professional to speak in-depth about their unique financial needs, including retirement and investment options. Gerber Life may be a better option for consumers who are more focused on ensuring basic financial protection for loved ones.
Gerber Guaranteed Acceptance Life Insurance
For seniors between the ages of 50 and 80, Gerber offers guaranteed acceptance whole life insurance. This policy builds cash value and has level premiums, but death benefits are limited to between $5,000 and $25,000. Theres a two-year waiting period during which, if you pass away for any reason besides an accident, the full death benefit would not be paid. Instead, your beneficiaries would receive the sum of premiums paid, plus 10% in interest. So, if you died from a heart attack or illness, your family would receive little in life insurance proceeds.
All guaranteed acceptance policies have a small maximum death benefit and a waiting period, making Gerbers coverage fairly standard. However, Gerber has better rates than most other insurers for this product.
Just keep in mind that guaranteed acceptance insurance is significantly more expensive than other types of life insurances, since the insurer collects no health information and therefore assumes youre a high insurance risk. This insurance is typically worth considering only if you have a significant pre-existing condition, such as kidney failure that requires dialysis, or you cant perform normal activities without assistance.
Life Insurance As An Investment
Whole life insurance provides more than a death benefit. Each month when you pay the premium, a portion of that money goes into a fund, and that fund grows with interest. Down the road, if you decide you no longer need the death benefit, you can instead elect to receive the current cash value of your policy. This is a big selling point of the Gerber Grow-Up Plan: It doubles as a college savings vehicle, with its cash value serving as a de facto college fund.
This line of thinking also presents a problem. Historically, cash value life insurance grows at an anemic rate. Your child’s college fund stands to become much more robust if you invest it in mutual funds. Granted, mutual funds do not provide life insurance for your child, if for whatever reason you think you actually need this coverage. However, attaching a rider for your child to your own life insurance policy would solve this problem at a much lower rate than purchasing the Gerber plan.