👶 Why Insurance Changes Everything
Before kids, insurance was about protecting yourself. Now someone depends on you for 18+ years of food, shelter, education, and support. Your insurance needs dramatically increase overnight.
New Parent Insurance Priorities
1. Life Insurance (CRITICAL)
Do FirstBoth parents need coverage—yes, including stay-at-home parents. If either of you died, the family would face massive financial disruption.
How much: 10-12x income for working parent, $500K-$1M for stay-at-home parent
Type: 20-year term (covers until kids are grown)
Cost: $30-60/month for $500K for healthy 30-year-old
2. Health Insurance
High PriorityAdd baby within 30 days of birth (special enrollment period). Review your plan—baby care, pediatricians, and potential complications matter now.
To check: Pediatrician network, NICU coverage, well-baby visits, immunizations
Cost increase: $150-400/month to add a child
3. Disability Insurance
Often OverlookedIf you can't work due to illness or injury, how will you support your family? Disability is more likely than death before age 65.
How much: 60-70% of income
Type: Long-term disability with "own occupation" coverage
Cost: 1-3% of annual income
4. Review Auto Insurance
With a baby, you have more to lose. Increase liability limits and consider umbrella coverage if you haven't already.
Minimum: 100/300/100 liability (not state minimums)
Consider: Umbrella policy ($1M for ~$200/year)
5. Update Beneficiaries & Create a Will
Not insurance, but essential. Update all beneficiary designations and create a will naming guardians for your child.
When to Do What
Buy life insurance NOW while healthy. Pregnancy can delay or complicate applications. Buy for both parents.
Review health insurance maternity benefits. Understand what's covered for delivery and baby.
Add baby to health insurance (special enrollment period). Don't miss this window!
Create/update will with guardians. Review all coverage is adequate. Consider umbrella policy.
New Parent Insurance Mistakes
❌ Only Insuring the "Breadwinner"
Stay-at-home parents provide $178K+ in annual services. If they died, you'd need childcare, housekeeping, etc.
❌ Waiting Until Baby Arrives
Life insurance takes 4-6 weeks. Pregnancy complications can affect approval. Buy during pregnancy.
❌ Relying Only on Employer Coverage
1-2x salary isn't enough, and you lose it if you change jobs. Get your own policy.
❌ Forgetting Disability Insurance
You're more likely to be disabled than die young. A disability with no income and a baby is devastating.
The Bottom Line
A baby changes everything—including your insurance needs. Priority #1: life insurance for both parents before baby arrives. Then ensure health coverage, add disability protection, and increase liability coverage. Budget roughly $200-400/month total for adequate protection of a growing family.