using gift tax or generation-skipping tax excluded funds. The eventual face value will pass to the children or grandchildren of the insured income tax-free. Grandparents or parents wishing to reduce their taxable estate may choose to use juvenile life insurance, so that the cash value is not included in the grantor’s estate. If the policy is held by a trust, the face value may be excluded from the estate of the insured as well. Insurability Many juvenile life insurance policies can be written without the need for a medical exam. In the case of larger policies, a doctor or insurance agent may have to confirm the age, sex, height, weight, and apparent healthiness of the child. There are optional riders to the basic policy that can add up to $2,000,000 of guaranteed coverage. Privacy A policy owner is not required to disclose the existence of a policy to the insured. Furthermore the policy owner can determine when or if the insured is told of, or has access to, the cash value of a juvenile insurance policy. If held within a trust the terms of the trust will govern access to, and use of policy funds. A juvenile life insurance policy in a trust may be free of estate taxes and not subject to the public and contestable probate process. Asset protection A parent wishing to protect assets intended to benefit a child may purchase juvenile life insurance, as the cash value of a life insurance policy is usually protected by state law against creditors and lawsuits. Indexed juvenile life insurance and whole juvenile life insurance Whole Juvenile Life is permanent whole life insurance that has a minimum guaranteed interest rate, plus a non-guaranteed dividend declared annually by the insurance company. Indexed Juvenile Life is permanent universal life insurance that has cash value increases linked to the performance of an equity index (e.g., S&P 500) up to a certain percentage (a “cap”) with downside protection (a “floor”). Certain Indexed Juvenile Life products have a guaranteed minimum interest rate of up to 2%. Example illustration The illustration shown is a Whole Juvenile Life policy, based on a three-year-old girl and a 2010 dividend and interest scale (combined rate of 6.85%) of an insurance company rated AA+ by S&P and Fitch. Annual premium of $3,600 or monthly premium of $305 is paid into the policy from age three to age seventeen inclusive. The