Part 2 with Nikki Bellock: Life Insurance for Parents

We’re back with Part 2 in our series with local State Farm agent Nicole Bellock.

Recently, we asked moms in Sauk County Mom community (our private Facebook group) what insurance-related topics they wanted to learn more about, and the topic with the most interest was life insurance for parents.

Whether you’re a new parent, thinking about your family’s long-term financial goals, or simply wondering where to start, this article offers a lot of helpful information to think through.

Why Life Insurance Matters for Parents

Securing life insurance is one of the most important things parents can do for their children. We never know what curve balls life may throw at us, which is why planning ahead matters so much for families. “We often say in our office that the only guarantee that we have in this life is that we aren’t going to make it out of it alive” said Nicole.

As parents, we are the primary providers for our children’s needs, including food, shelter, education, and healthcare. When one parent passes away prematurely, life insurance provides a financial safety net to help cover those ongoing expenses. It can help maintain a family’s current standard of living as well as leave behind a legacy to help provide for future expenses such as college tuition.

Covering Everyday Expenses and Debt

Most families have debts like mortgages, rent, or car loans. There are also ongoing monthly expenses like utilities, groceries, childcare, and cell phone bills.

You may also want your children to continue participating in activities they love, whether that’s baseball, hockey, dance, music lessons, or something else important to them.

The surviving parent is often already under emotional and financial stress. Life insurance can help ease some of that and help maintain stability for children during a difficult time.

Final Expenses and Unexpected Costs

Final expenses are another major consideration for families.

According to Nikki, the average “standard” funeral with a casket, viewing, services, and burial often costs between $7,500 and $9,000. Cremation with services averages around $6,000, while even a simple cremation without services can still cost thousands of dollars.

Most funeral homes and crematoriums require payment upfront, which can create tremendous stress for families already navigating grief. You do not want your family to have to “scramble” to figure out how they are going to pay for your final expenses.

Medical and long-term care costs can also add up quickly. Hospital stays, rehabilitation, assisted living, or nursing care can leave families with significant bills that still need to be paid.

Living Benefits and Cash Value Policies

Another thing many families may not realize is that some life insurance policies come with “living benefits.”

Certain policy types build cash value over time, which can be used as a “savings account” and later be used for unexpected expenses or financial goals. Nikki shared that she has seen people use cash value to:

purchase a vehicle
help fund a down payment on a home
remodel a home
start a business
supplement retirement income

One of her favorite examples was a 91-year-old man who had purchased a life insurance policy at age 23. His original policy had a $5,000 death benefit, which was a lot of money in 1958. He took it out so that his wife could pay off the mortgage if something happened to him.

He called Nikki last year and said, “I know I have had this life insurance policy with State Farm and I know that I have built up some pretty significant cash value. Can you tell me how much it is?” She looked into it and he had built up $42,000 in cash value!

When she called him back and told him, he said “I’m 91 years old. No one is going to give me a car loan at 91 years old but our car is on our last legs. Could I take that cash value out and use it to buy a car outright?” Nikki said “Absolutely! Let’s get the paperwork started!” This just shows you the absolute power of compound interest!

Why Starting Young Matters

One of the biggest cautions Nikki gives families is to not wait too long to purchase life insurance.

The younger and healthier you are, the more affordable life insurance typically is. Waiting can lead to higher premiums, and in some situations, health conditions may make someone uninsurable altogether.

Applications can sometimes be declined or rated differently due to:

cancer
heart conditions
diabetes
obesity
mental health conditions
other chronic health concerns

Nikki said “We see applications rated with higher premiums for health conditions like diabetes, arthritis, or even just obesity. Locking in coverage early often means securing both affordability and insurability”.

Life Insurance for Children

Nikki also emphasized the importance of considering life insurance for children.

While no parent wants to think about worst-case scenarios, purchasing coverage while children are young and healthy can be surprisingly affordable and may help protect their future insurability.

“We have some very cool ‘limited pay’ policies that are perfect for children because you only pay for them for a certain number of years and then they have a fully paid-up life insurance policy for the remainder of their lives. They also continue to accrue cash value so they have all of the “living benefits” mentioned above. They can use the cash value to help with college expenses, buy a car or put a down payment on a house.

This is such an amazing gift for parents and grandparents to give to their littles! I wish that I had asked my parents to do this for my children instead of buying them Barbies and Polly Pockets for every birthday and Christmas! All those toys are long gone at the thrift store, but the legacy of life insurance would still be here” explained Nikki.

That cash value may later help with:

college expenses
purchasing a vehicle
a future home down payment
other major life expenses

Finding the Right Coverage for Your Family

If you’ve worried that life insurance may be too expensive, Nikki says many families are surprised to learn there are options available for different budgets and goals.

Every family’s situation is different, which is why life insurance is not “one size fits all.”

A Life Needs Analysis can help families determine:

how much coverage makes sense
what types of policies fit their goals
what works within their budget
how to best protect their family and assets

Final Thoughts

Life insurance is a topic many families put off because it can feel uncomfortable to think about. But for many parents, having a plan in place brings peace of mind knowing their family would have financial protection if the unexpected happened.

A huge thank you to Nikki for sharing her knowledge and helping answer questions local families said they wanted to learn more about.

About Nicole Bellock

Nicole Bellock is a local insurance agent who works with families to help them feel confident and informed about their coverage. She’s passionate about making insurance less overwhelming and believes families deserve clear, honest guidance when it comes to protecting what matters most.