If a spouse earns no income but stays home with the children, the surviving spouse will still wish for an insurance policy for the additional expenses that will occur after their spouse’s death. I’m sure you weren’t ruling out exceptions, but I did want to add that.

The low price of the premium goes to show that the chances of a child dying are minimal. Insurance companies can charge that because they know that 99% of the policies will never collect.

Could it happen? Of course. Would it be a financial hardship? Under the circumstances you describe, of course. Does that mean spending $100 for something they most likely won’t need is financially sound? In my humble opinion, no. There are a number of other areas that it could be much better spent considering the risks involved - for example, for disability insurance. An accident to the breadwinner of the family is much more likely to happen than the death of a child and would be far more devastating financially for the family.

1) the chances of a child dying ar minimal
2) if the family instead takes the premium they would pay and puts it aside and begin saving for the child’s college as they should, they will have the resources to pay in the case that a tragedy does happen.
3) not to be cruel, but strictly from a financial point of view, many of their monetary resources that were previously earmarked for the child will now be free meaning even if they have to borrow, they should be able to pay it back quickly.

It is an emotional time and something that nobody should have to go through, but from a financial perspective of risk/reward \, child life insurance just doesn’t add up.

Young families often don’t have much in the way of liquid resources and a funeral and burial can start around $5k. In some parts of the country, it can be as high as $10-15k. “Burial policies” for children are dirt cheap and make sense for families for whom a child’s death would be a financial disaster as well as an emotional one.