Hi Brendan,
In many instances, the estate may not be in the form that the child may want to sell. For example, if a sole child inherits a house worth a few million and a modest amount of cash, the CAT bill could force a sale of the property to pay the CAT. Or if a big chunk of the inheritance is made up of shares (traded or otherwise), the timing of the death might be lousy from the point of view of selling the shares or there may be other reasons why the child might not want to sell the shares to pay the CAT bill.
In these examples, a CAT life assurance policy can remove the need to sell assets to pay a CAT bill.
On a related note, it's important to review cover on a CAT policy regularly as CAT thresholds change, as does the value of the estate.