Life insurance when you're expecting a baby

A baby on the way is the single most common reason people buy life insurance, and the timing question comes up every time: now, or after? The answer is almost always now, and the reasons are practical rather than sentimental.

Why before, not after

Price is set by your age and health at the moment the policy is issued and locked for the whole term. Every month you wait is a month older, and the months after a birth are not known for sleep, free time, or the urge to fill out forms. Applying now takes an evening; applying "once things settle" often takes a year. And the coverage is in force on the day the baby arrives, which is the day the need begins.

How carriers treat pregnancy

Pregnancy is not a health condition for underwriting purposes, and carriers issue coverage to expecting applicants routinely. An uncomplicated pregnancy doesn't change your rate class. Carriers commonly use your pre-pregnancy weight for their build tables, and the application will ask about pregnancy-related conditions such as gestational diabetes or hypertension; if either is present, some carriers postpone until a few months after delivery. If an exam is required, some carriers prefer to wait until after the birth. For most applicants, especially through an online process, none of this comes up.

Both parents

The parent who'll be on leave, or who'll stay home, needs coverage as much as the earner. If that parent died, the survivor would face full-time childcare costs while working. Our guide on life insurance for a stay-at-home parent covers how to size it; the short version is to price the work that would have to be replaced.

How much

Size it as if the child is already here, because in a few months they will be. Income times 20 to 25 years, plus the mortgage and other debts, plus what you'd want for education, minus employer coverage and savings you'd count. Most young families land between $1 million and $2 million per parent. The new-parent guide walks through the numbers and the estimator does the arithmetic.

Beneficiaries, before and after

Name your partner as primary beneficiary now. For the contingent beneficiary, don't plan to name the baby directly; a minor can't receive the proceeds and a court-supervised guardianship of the money may follow. Set up a trust, or use a custodial arrangement under California's Uniform Transfers to Minors Act, and update the designation after the birth. It's also the moment to write or update a will and name a guardian, which is a separate document from the policy.

The evening it takes

Have your driver's license, medication list, and doctor's name; answer the health questions yourself; see the price; decide. If you're asked for more information because of the pregnancy, that's the carrier's process, not a judgment. And if the online route isn't the right fit, the agent behind this site is a licensed person you can email.