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By now, I’d imagine that you’ve all seen the commercials: the poorly-acted/over-acted ones in which a group of parents sit gathered around a literal “round” table discussing the benefits of the Gerber Life College Plan. “It’s a life insurance policy, too,” states one of the actors as another chimes in “Oh, that’s different.” In reality, it’s a clever money-making plan for the Gerber Life Insurance Company. Same goes for their Gerber Grow-Up Plan.

It seems that the Gerber Life Insurance Company (a different entity than the Gerber company that makes the baby products you no doubt have somewhere in your home – yet they share the familiar “Gerber Baby”) knows this quite well, as they don’t like consumer feedback. One look at their YouTube videos will quickly reveal that their videos are disliked more often than not, and that public statistics and commenting have all been disabled. 

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IMG 0089Having seen the Gerber Grow-Up Plan commercials that mention “an envelope sent to your home,” I was always somewhat pleased that an envelope had never arrived here at The Rock Father house. Today, that changed.  “See what Moms are saying about the Grow-Up Plan” touts the light pink envelope (they must think that Dads don’t care).  Inside are a handful of quotes attributed to “Moms” across the country, all praising the low cost insurance while prodding you to purchase “…extra peace of mind.”

In the case of the Grow-Up Plan, buying life insurance on your children just doesn’t feel right to begin with. There would be nothing worse than losing a child, and I don’t see how having some extra money in exchange for their life would possibly soften the blow. It just seems like the wrong thing to do. A parent should have life insurance on themselves to protect the children, but to insure the kids themselves seems dirty. You can borrow against the policy at 8% interest along the way, or when the insured child hits 25 they can cash out for the amount of premiums paid into the plan. That’s a quarter-century commitment. If you’re going to sock away some money for the kids, there’s better ways to do it, starting with a savings account.

A little searching online revealed that there’s plenty of other people out there that have questioned the value of these Gerber plans over the years. In fact, there’s a pair of great articles from the Wall Street Journal’s Market Watch circa 2011 that address both the Grow-Up Plan and the College Plan in detail. On the latter note, the numbers on the College plan are absolutely fascinating in how little they benefit the consumer.

While there might be some benefit in these plans to “insure insurability” (kids get to keep coverage even if they develop a condition that might deem them uninsurable), a 25-year commitment seems like a big choice to take based on a small chance. And what if you decide to cancel the whole affair early? It’s very likely that you just lost a lot of money.

At the end of the day, the Gerber commercials annoy me tremendously, as does the envelope that arrived today, complete with vaguely-worded propaganda designed to prompt a financial response to a play on the emotions of parents and grandparents who might be persuaded into thinking that they’re “doing the right thing” when in reality, they’re buying into something that they don’t need.

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