Buying life insurance for your parents

You can buy life insurance for your parents if you depend on them financially and have their consent and participation in the application process. Alternatively, they can get their own policy and list you as a beneficiary.

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Rebecca Shoenthal

Rebecca Shoenthal

Editor & Licensed Life Insurance Expert

Rebecca Shoenthal is a licensed life, disability, and health insurance expert and a former editor at Policygenius. Her insights about life insurance and finance have appeared in The Wall Street Journal, Fox Business, The Balance, HerMoney, SBLI, and John Hancock.

&Amanda Shih

Amanda Shih

Editor & Licensed Life Insurance Expert

Amanda Shih is a licensed life, disability, and health insurance expert and a former editor at Policygenius, where she covered life insurance and disability insurance. Her expertise has appeared in Slate, Lifehacker, Little Spoon, and J.D. Power.

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This article has been reviewed by a licensed Policygenius expert to ensure that sources, statistics, and claims meet our standard for accurate and unbiased advice.

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By

Maria Filindras

Maria Filindras

Financial Advisor

Maria Filindras is a financial advisor, a licensed Life & Health insurance agent in California, and a member of the Financial Review Council at Policygenius.

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If your parents have co-signed a loan or credit card with you, provide critical childcare, or support you financially, a life insurance policy can protect you and your loved ones when your parents pass away. Life insurance can also help your elderly parents if they haven’t put aside money for end-of-life costs like funeral expenses.

Buying a life insurance policy for your parents can seem like an appealing way to fully prepare for life’s eventualities. But buying life insurance for someone else is complicated, and in most cases, it makes more sense for your parents to purchase their own coverage and name you as the beneficiary.

Key takeaways

  • You need consent and proof of insurable interest to purchase life insurance on someone other than yourself.

  • It's easier to buy final expense life insurance on behalf of your parents, but policies are expensive.

  • If you would suffer financially from the death of a parent, they should get a term life insurance policy that pays out to you.

Can you buy life insurance for your parents?

Yes, you can purchase life insurance for your parents. However, it can be difficult to take out a life insurance policy on someone other than yourself even if that person is related to you.

When you buy life insurance for yourself, you are both the policyholder and the person whose life is insured by the policy. If the policyholder and the insured are two different people, the policyholder has to prove that they'll suffer financially if the insured dies (known as insurable interest).

This is hard to prove if you’re an adult child buying a policy for a parent and is rarely approved by insurers. You'll also need your parents to consent to the policy because they need to sign the policy contract and participate in the underwriting process.

It will be much simpler to get life insurance coverage for your parent if you help them apply for a policy that they will own with you as the beneficiary. You can pay the premiums even if your parent owns the policy.

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What type of life insurance should your parents have?

The right life insurance policy for your parents depends on their needs. Term life and whole life insurance policies are difficult to buy on someone else’s behalf, but final expense life insurance is easier to get if you're purchasing a policy on your parents and you’re only looking for a small benefit amount.

  • Term life insurance is the best choice if a parent's death would lead to a substantial financial loss, loss of household support (like childcare), or if you would have to take on their debts.

  • Whole life insurance isn't a cost-effective choice for most people, but if your parents need to cover estate taxes or have lifelong dependents, it may make sense.

  • Final expense insurance can be a good fit if your parents have medical conditions that make it hard to qualify for term or whole life insurance. Coverage amounts are low and premiums are high compared to other policies.

→ Learn more about buying life insurance for seniors

How to buy life insurance for your parents

The first step to buying life insurance for your parents is to get their consent. You can't buy a policy without them — you'd be committing insurance fraud — since they need to answer application questions and participate in a medical exam.

If your parents have advanced dementia or Alzheimer’s, reach out to a Policygenius agent for advice before proceeding.

Once you have their consent, getting a policy is relatively straightforward. You'll get quotes, then your parents will go through the application and approval process and set up payments. Make sure you're a named beneficiary on both policies.

→ Learn more about buying life insurance

Alternatives to buying life insurance for your parents

If you’re worried about affording burial costs or other final expenses for your parents, you have a few other options:

  • Encourage them to get their own life insurance and name you as the beneficiary.

  • Put aside money for end-of-life expenses for your parents, or encourage them to set up an account for this purpose and pay into it themselves.

  • Pre-pay for funeral costs through a funeral home.

Buying a life insurance policy that insures your parents can be difficult. But as long as they're open to applying for their own policies and naming you as a beneficiary, it's relatively simple to ensure you and your family are financially protected when your parents pass away.

Frequently asked questions

Can I get a life insurance policy on my parents?

You can buy life insurance on your parents only if you can prove you'll suffer financially when they die and have their explicit consent.

Can I pay for my parents' life insurance if I don't own the policy?

You can pay for a parent's policy even if you aren't the policyholder, but you will need their consent.

What is the best life insurance for my parents?

The best policy for your parents depends on their health and financial needs. Term life insurance is most affordable, but final expense is easier to get if they have complex health issues.

Authors

Editor & Licensed Life Insurance Expert

Rebecca Shoenthal

Editor & Licensed Life Insurance Expert

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Rebecca Shoenthal is a licensed life, disability, and health insurance expert and a former editor at Policygenius. Her insights about life insurance and finance have appeared in The Wall Street Journal, Fox Business, The Balance, HerMoney, SBLI, and John Hancock.

Editor & Licensed Life Insurance Expert

Amanda Shih

Editor & Licensed Life Insurance Expert

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Amanda Shih is a licensed life, disability, and health insurance expert and a former editor at Policygenius, where she covered life insurance and disability insurance. Her expertise has appeared in Slate, Lifehacker, Little Spoon, and J.D. Power.

Expert reviewer

Financial Advisor

Maria Filindras

Financial Advisor

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Maria Filindras is a financial advisor, a licensed Life & Health insurance agent in California, and a member of the Financial Review Council at Policygenius.

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