Stepping in changes your plans
Many kinship carers took on a child suddenly, after a family crisis. Grandparents who expected a quieter retirement find themselves on the school run again. Aunts and uncles fit an extra child into a home and budget planned for fewer.
If you died, the child could face a second upheaval. Life cover cannot prevent that, but it can make sure the next carer has money to keep the child in the same school and close to the same people.
Your income may already be stretched. Grandparents often live on pensions, and aunts or uncles may have cut back hours to care for the child. Cover does not need to be large to make a difference to the next carer.
Inheritance and the law
Unless you have adopted the child, they may have no automatic right to inherit from you if you die without a will. Your estate would go to your own relatives under the intestacy rules.
A will that provides for the child, together with a life policy written in trust for them, closes that gap. Your will can also say who you would want to take over their care, though the court and local authority will make the final decision.
Talk to the child's other family members if it is safe to do so. A shared plan for who would step in next, agreed in advance, can make a court or local authority decision easier and faster.
Choosing a term when you are an older carer
A grandparent raising a young child may need cover that runs into their 70s. Insurers set a maximum age at which a policy can end, and these differ, so the length you can get may be limited.
If term cover cannot run long enough, whole of life cover is an option. It pays out whenever you die and the money can still go into trust for the child. The premium will be higher.
Think about critical illness cover too. If you were seriously ill, a lump sum could pay for help with the child while you recover, which matters more if you have no partner to share the load.
Allowances and support that stop
Some guardians receive an allowance from the local authority or a benefit for the child. These usually follow the child to the next carer, but your own pension and income would not. Think about the gap the household would face, rather than the child's costs alone.
If you are working, income protection could help keep the household going through a long illness.
Keep the child's own savings separate from your planning. Money the child has in their own name, such as a junior ISA, belongs to them, and your cover is there to support the household they live in.
How Hi Tomorrow helps guardians
We understand that your family did not follow a standard pattern. We look at your age, health, the child's age and any support you receive, then compare insurers on our panel whose age limits fit what you need.
We set up the trust with you and suggest you see a solicitor about your will and guardianship wishes.