As in, simulator instructor with an airline? Then no, all airline instructors are employees of the company and are either current or semi-retired pilots. Some without medical, but all with a seniority number.
If you mean you wish to become an instructor with, say, FlightSafety, CAE, et al., then yes that is possible. However, they also like to see previous commercial experience and typically value time on type, although it’s not a hard and fast rule.
Of the guys I know at FlightSafety, most are ex-airline pilots who lost their medical or lost their desire, so that is the typical path. However, one or two are ex-flight school instructors who taught multi-IFR and then applied to the Sim centre. The best instructors at those centres are the ones with previous experience and who understand the difference between “nice to know” and “need to know,” but even without operational experience, you can still get the job done. You would be best to contact one of those companies directly to express an interest and they can tell you what you need to do outside of an airline job.
But, two things. One; this info is for TC/FAA rules, and CAA or JAA may have a different outlook on things.
Two; if you think simulator instructing is “family friendly,” you had better talk to a Sim instructor. I think I probably see my kids just as much now as I did when teaching in the sim. A lot of late nights, early mornings, and long days. Often the kids were still asleep when I left and in bed when I got home. At least on the road I’ve got FaceTime or Skype to talk to them - never had time as a sim instructor.