Why would parents, of a young adult without dependents, not profit from the young adult's Term Life Insurance?
Hereafter 'Young Adult' means someone of age 18-35 and shall be abbreviated YA.
These answers unanimously declare (per p 332 of Personal Finance For Canadians For Dummies (4 ed, 2006, but note that a 5 Ed (2010) exists) by Tony Martin, Eric Tyson):
If there are no dependents, there is no need for life insurance.
But is the following a sound counterargument? If not, please rebut it.
Even if the YA has no dependents, if the YA dies suddenly, then the YA's parents could earn some money from a YA's Term Life Insurance (e.g. Term ? [10, 35 years]; Benefit Amount ? [0,000, 0,000 CDN])?
Without Term Life Insurance, can the parents or YA really earn Benefit Amount ? [0,000, 0,000 CDN], from investing over 10 to 35 years?
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It is not likely the YA would die in 10 years. Hence the investment the parents make in policy premiums would lose all of its money. Repeat: lose all money.
On average, you'll slightly lose with insurance. It's there for peace of mind and to mitigate a catastrophe. It's not an investment.
Of course, if the YA is likely to die suddenly, that might change things. But concealing medical information would be grounds for denying the policy claim.
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