Insurance Tips for Expecting Parents

When expecting parents prepare for their new baby, they might focus on painting the nursery, picking out a stroller and buying enough diapers. Amid all the exciting plans and arrangements, some parents might forget to change their insurance policies to reflect their new needs. Yet life, home, auto and health insurance are all vital for protecting the health and well-being of a growing family.

Before the big day, ensure you take care of the essential preparations, like becoming financially healthy before your baby arrives. These insurance tips for expecting parents will help you plan for maternity and newborn wellness, so your baby starts their life well-protected.

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Life Insurance
Home Insurance
Auto Insurance
Health Insurance

Parents are one of the groups most likely to purchase life insurance coverage because they want to ensure their child is taken care of in case of an accident.

Prioritize Life Insurance

Life insurance should be at the top of the list of coverage options for first-time parents to consider. Life insurance provides a safety net for situations when the primary wage earner in a family can no longer earn a living. Parents are one of the groups most likely to purchase life insurance coverage because they want to ensure their child is taken care of in case of an accident.

Many parents may think they only need life insurance if they are the primary wage earner. However, any parent with children should consider the effect on their children if they lose the ability to work. According to the Bureau of Labor Statistics, mothers with children under 18 years old contribute to the family income in 71.2% of households. Fathers in the same situation contribute to the household income in 92.3% of families.

The loss of any household income can majorly affect a family’s life.

Reasons Families Need Life Insurance

If you support any dependents with your income or plan to do so soon, you need life insurance. Life insurance provides peace of mind and coverage in the following areas:

Guaranteed income replacement: When you die, your dependents will need funds to support themselves. Since many households rely on two incomes to pay their expenses, the loss of one income could be difficult to replace. A life insurance policy will provide your child with a lump-sum payment in full if you die. This financial safety net guarantees vital protection for your loved ones.
Tax-free benefits: Collecting on a life insurance policy may not cost your child a dime. Life insurance policies are generally passed down tax-free to your beneficiaries. Providing this arrangement can be an excellent way to maximize your child’s financial support.
Replacing essential services: Lost income from a primary wage earner is just one expense you may want to cover for your child. Even if one parent stays at home with your new baby, life insurance can cover the necessary functions that a stay-at-home parent performs, like child care and housecleaning. These costs can quickly add up, especially considering that the average American family spends $8,355 a year on child care.
Coverage so your family can continue: In the case of your absence, your family will still have goals and financial responsibilities. Life insurance policies can help your child pay for college tuition, living expenses or other investments, so you can leave a legacy of caring.

How to Choose the Best Plan

Determining how much life insurance you need when you have a baby on the way can be tricky, especially if this is your first child. Keep in mind that if you have a group life insurance plan from your employer, the coverage range might be limited. Depending on your family’s needs, a group plan may not be sufficient. Parents often need to supplement a group plan with an individual life insurance policy.

Here is how to find the best life insurance plan for expecting parents:

Calculate expenses: The first step in determining your life insurance needs is to consider the costs your child would need to have covered. This sum could include everything from formula, diapers, food and clothes to mortgage and rent payments. You might also want to pay for long-term expenses, like child care and health insurance. The cost of raising a child varies depending on the cost of living and the child’s age, although it could add up to hundreds of thousands of dollars.
Determine your goals: Parents often have goals for their children besides paying for necessities. You might want to give your child the opportunity to play sports or take up other extracurriculars. Longer-term goals could include sending your child to college. Once you decide on your financial goals for raising your child, determine which ones are most important to you and what you would need to pay to achieve them.
Learn which insurance policies fit your needs: Every household is unique when it comes to finding life insurance coverage. You can get permanent coverage through a whole life insurance plan with locked-in premium rates or a universal plan with flexible rates. You can also obtain coverage for a fixed time with term life insurance. Remember that each plan differs regarding premiums and how the life insurance company distributes the money to your beneficiary.
Sign up at the right time: Strategically signing up for insurance can save you money. Suppose you are an expecting mother looking to add life insurance during pregnancy. If you have any health issues associated with pregnancy, such as gestational diabetes or high cholesterol, your rates could be higher. Thus, the best time to get life insurance is before pregnancy or early in your first trimester.

With the right planning, expecting parents can find a life insurance policy that provides the coverage they need at the price they can afford.

How to Choose the Best Plan

Here is how to find the best life insurance plan for expecting parents:

Calculate expenses: The first step in determining your life insurance needs is to consider the costs your child would need to have covered. This sum could include everything from formula, diapers, food and clothes to mortgage and rent payments. You might also want to pay for long-term expenses, like child care and health insurance. The cost of raising a child varies depending on the cost of living and the child’s age, although it could add up to hundreds of thousands of dollars.
Determine your goals: Parents often have goals for their children besides paying for necessities. You might want to give your child the opportunity to play sports or take up other extracurriculars. Longer-term goals could include sending your child to college. Once you decide on your financial goals for raising your child, determine which ones are most important to you and what you would need to pay to achieve them.
Learn which insurance policies fit your needs: Every household is unique when it comes to finding life insurance coverage. You can get permanent coverage through a whole life insurance plan with locked-in premium rates or a universal plan with flexible rates. You can also obtain coverage for a fixed time with term life insurance. Remember that each plan differs regarding premiums and how the life insurance company distributes the money to your beneficiary.
Sign up at the right time: Strategically signing up for insurance can save you money. Suppose you are an expecting mother looking to add life insurance during pregnancy. If you have any health issues associated with pregnancy, such as gestational diabetes or high cholesterol, your rates could be higher. Thus, the best time to get life insurance is before pregnancy or early in your first trimester.

With the right planning, expecting parents can find a life insurance policy that provides the coverage they need at the price they can afford.

Update Your Home Insurance Policy

Home insurance isn’t likely to change just because your family gains a new addition. However, when you add a new member to your family, you may feel you need more space to grow. Many parents choose to move because they need an extra bedroom for the baby or want to live closer to a specific school system.

Relocating to a new house or building a new addition to your current one could increase your home insurance payments. You might consider changing your home insurance policy altogether if you’re in the following situations:

A small studio apartment in the middle of the city might not be your ideal starter home for raising your child. Many parents want a house with room for playing outside.

1. You’re Moving Houses

Buying a new house in preparation for a baby is common for first-time parents. A small studio apartment in the middle of the city might not be your ideal starter home for raising your child. Many parents want a house with room for playing outside. Quieter neighborhoods are also appealing, as are homes closer to family-friendly amenities like parks and day care.

However, moving into another house is one way your home insurance costs can increase significantly. You might find that your insurance plan for a smaller home or an apartment no longer covers your needs. In addition, upgrading to a home with higher square footage usually increases monthly mortgage payments.

If you are interested in buying your first home in preparation for a new baby, you will need to get homeowners insurance. Homeowners insurance is more expensive than renters’ insurance, so if you upgrade to a larger home, you should budget for the extra expense.

2. You’re Building a New Addition

Another way that parents’ home insurance could change is if they make major home improvements to their current house. Safety upgrades like mold remediation, refinishing floors and painting or staining should usually be completed before a baby’s arrival. You might also want to complete a more extensive home project, like adding a bedroom or bathroom to your house.

Whatever kinds of upgrades you make, you’ll need to let your insurance company know so they can adjust your coverage. Underinsuring your renovated home can leave you at risk if an accident occurs.

How Expecting Parents Can Prepare for Home Insurance Changes

Improving your living space can significantly affect home insurance. Parents should consider taking the following steps to prepare for a change in homeowners insurance:

Determine your needs: Before moving into another house, carefully consider how much space your new baby needs. Often, parents can wait to buy a larger home until their child gets older. If you don’t plan to move, your house may require special treatment to be ready for the baby.
Shop around: If you are switching home insurance entirely, compare policies to find the best coverage for your budget. Be aware that you may save money if you bundle home and auto through the same insurance company.
Keep a list of your belongings: As with your other possessions, the items you buy for your baby — like a crib, stroller, car seat and changing table — could be expensive to replace if they are damaged in a fire or storm. To protect the contents of your home, Actual Cash Value coverage will reimburse you with your items’ value on the day they were destroyed, including depreciation. However, Replacement Cost Value pays for the expense of actually replacing the items.

Consider the different ways that having a family can impact your auto insurance rates.

Consider How a Family Will Affect Your Auto Insurance

Having a new baby could also affect your auto insurance costs. As with home insurance, having a child only affects auto insurance indirectly. Consider the different ways that having a family can impact your auto insurance rates:

1. Driving a Family Vehicle Could Lower Your Rates

Many parents find the need to drive a larger car or sensible minivan when they welcome their first child. Your car needs to accommodate a bulky car seat along with all baby gear like a stroller and a diaper bag. Larger vehicles are also typically safer in the event of a crash, making them a good choice for parents.

Switching to what insurance companies call a family vehicle could positively impact your rates. Sports and luxury vehicles are more costly to insure because they have more expensive parts and their drivers tend to be less careful. However, drivers of minivans often have babies on board. These cars tend to be among the cheapest to insure because drivers are often more cautious, so insurers trust they will make fewer insurance claims.

2. Parents Often Pay Less

Many insurance companies charge parents lower auto insurance rates than single people and even married couples without children. This is because parents tend to be responsible drivers, knowing that it’s up to them to get their family home safely. They will probably end up filing fewer claims, making them cheaper for an insurance company to insure.

3. Matching Auto and Home Can Save You Money

New parents are always on the hunt for ways to save money. Every penny saved is more they can put toward new diapers or other funds for their bundle of joy. Parents who are also homeowners could qualify for savings on their auto insurance when they bundle it with a home insurance policy from the same insurance company.

4. Additional Coverage Will Cost You

Increasing your coverage can give you peace of mind and help you protect your little one wherever you travel.

Additional coverage can protect you, your family and your finances in adverse situations. New parents might be interested in adding personal injury protection insurance to their auto policy. In case of an accident where you or your passengers are injured, this no-fault policy will help pay for your medical bills and ongoing care.

Another kind of coverage extension that could be appealing to parents is a roadside assistance plan. Roadside assistance can come to the rescue if you run out of gas, lock yourself out of your car or need a tire changed. Even if you know how to perform minor repairs on your vehicle, adding a crying baby to the mix can cause additional stress. This addition to your policy can help you navigate those unanticipated situations.

How to Choose the Best Auto Insurance Plan

With so many coverage options out there, it is essential to shop around and compare prices for auto insurance. Going straight for the minivans at the car dealership may not get you the cheapest rates. It’s still important to compare the cost of insuring each car you’re interested in before you make a purchase.

In addition, carefully analyze multiple bundle options to determine if they save you money. If you find two policies that cost less than a bundled policy, your best bet is to buy them separately. Discuss your options with your insurance agent to determine whether bundling can help you lower your costs.

Having insurance during pregnancy is vital. Adequate health coverage can help pay for routine checkups and screening tests that keep mom and baby healthy.

Check Your Health Insurance Benefits

Young, healthy people may not feel like health insurance is necessary for them. According to the 2019 American Community Survey, Americans between the ages of 19 and 34 are the least insured age group. This age range is when most people in the U.S. become first-time parents, which makes it a necessary time to purchase health insurance coverage.

Having insurance during pregnancy is vital. Adequate health coverage can help pay for routine checkups and screening tests that keep mom and baby healthy. Childbirth and maternity care are considered essential health services under the Affordable Care Act (ACA). This policy ensures that most health insurance policies cover a policy holder’s pregnancy and childbirth.

Health Insurance Benefits for Families

The best insurance plans for pregnancy are the ones that give mother and baby plenty of coverage before and after delivery. Besides providing essential coverage for new moms, adding health insurance can benefit a new family in several ways:

Coverage for the new mom: Because ACA defines pregnancy and child care as essential health benefits, new moms with qualifying health insurance policies can get financial help for maternity care. Pregnancy care could include doctor visits, checkups and tests before and after the birth. These services include preventative care like screening for pregnancy-related conditions. If you have a prescription, it can also cover folic acid supplements. New mothers can also receive lactation support and other consultations.
Newborn care after birth: Newborn care is another benefit covered under most insurance plans. This level of care includes immunizations, hygiene and umbilical cord care while your baby is still in the hospital. The Newborns’ and Mothers’ Health Protection Act of 1996 requires that group health plans allow benefits for mothers and newborns for at least 48 or 96 hours following delivery, depending on the type of birth. Employers must typically approve an extension of benefits if the parent or baby needs more recovery time.
Additional benefits: Depending on your plan, you might qualify for additional benefits for yourself or your baby. Many insurers offer other benefits through programs that provide maternity coaching and support. Some even offer coverage for prenatal classes or newborn car seats.

How to Choose the Best Health Insurance Plan

Finding the best health insurance during pregnancy should be uncomplicated. Planning may take time, but in the end, it will be worth it to have all the information you need to make the best decision for your future child. Remember the following suggestions when shopping for health care coverage for your new baby:

Plan to pay for what essential maternity care doesn’t: Depending on your tier of coverage, you could need to pay for part of your hospital bill out-of-pocket. Essential pregnancy and newborn care won’t eliminate your deductible or copays. You might be able to lower your copays by choosing a doctor and hospital that are part of your plan’s network. Check with your provider for specifics.
Ensure you have a qualifying plan: You may be excluded from maternity coverage if you have a non-qualifying plan. For instance, if you are a dependent on your parent’s health insurance plan, you cannot receive pregnancy and newborn care. Plans that existed before the ACA was passed, short-term plans and those offered by some self-insured employers are also not required to provide pregnancy insurance.
Obtain coverage for your baby soon: Many employer health plans include newborn health insurance for the first 14 days after birth. However, you must formally add your newborn to your plan within either 30 or 60 days of delivery. If you miss this window, you will have to wait for the next open enrollment period. If your current plan doesn’t provide the coverage your family needs, having a baby is a qualifying life event, allowing you to switch policies.
Anticipate increased rates: Adding a child to your health policy increases your monthly payments. The out-of-pocket maximum and deductible for a family plan is usually twice that of an individual plan, regardless of the number of people on the plan. However, if you have more than three children younger than 21, you will only need to pay for coverage for the oldest three.
Consider buying a plan just for your baby: If you are unable to include children on your current employer plan, purchasing a child-only plan might make the most sense. Visit the federal or state health insurance marketplace if you want a plan for your baby and don’t qualify for Medicaid or the Children’s Health Insurance Program (CHIP). If you buy one directly through an insurer, it might cost more. Beware of short-term and catastrophic plans that likely exclude maternity and newborn coverage.

One of the best ways to prepare for adding a new baby to your health insurance is to obtain a list of the exact services your health plan offers well before your due date. It can also be helpful to determine what your out-of-pocket expenses will be, so you can plan for those costs ahead of time.

How David Pope Insurance Services, LLC Can Help Expecting Parents

Expecting parents have many insurance decisions to make before their bundle of joy arrives. Each family’s coverage needs are unique. Speak with a local expert who understands the health, life, auto and home insurance options available in your area so you can find and understand the plan that works best for you.

David Pope Insurance is a local insurance provider with over 20 years of experience providing a range of insurance services. Our expert team can help new parents reach financial stability by finding the lowest rates for the coverage they need. We offer fast and flexible quotes designed to work for you.