Congratulations! Whether it’s a boy, a girl or just a plus sign on an EPT right now, having a baby is cause for celebration. It’s also a good time to give some thought to your insurance. We know, that’s not nearly as fun as picking out colors for the nursery or shopping at Baby Gap, but having the right insurance coverage is an important part of being a good parent. Here’s what you need to know.
Before the Baby Comes
Review your health insurance coverage so you know what your policy provides. Talk to someone in your company’s HR department and have your spouse do the same. You’ll want to see which plan has the lower co-pays and the better coverage for prenatal care, emergency procedures, traditional and c-section deliveries, and post-partum , neo-natal and pediatric care. If your employer offers a flexible spending account or health savings account, you might want to look into these plans that let you set aside pre-tax dollars to cover medical expenses and child care.
Check out our state health care guides to find out the rules governing maternity and newborn insurance mandates where you live.
Notify your insurer that you’re expecting and find out what if any deadlines and requirements you’ll have to meet to register your baby for insurance benefits. If you’re adopting, many state’s mandate coverage for your new child, so you’ll want to check with your insurance company about that, too.
After the Baby Comes
If you don’t have life insurance, get some. Even if one of you doesn’t work, both of you should have life insurance coverage. If one of you should die, life insurance will help the other pay the household bills.
How much will you need? Consider that experts estimate that it now takes a middle-income family about $250,000 to raise a child from birth to age 17…and then there’s college, which keeps getting costlier every
year. Add up your basic living expenses (housing, medical care, food, transportation) and add in child care, education and savings.The total will give you a good rule of thumb for purchasing life insurance. While whole life insurance policies let you build cash value, they can be expensive for a young family starting out. Term life, which provides death benefits to your beneficiaries for the term of the policy, are typically more affordable.
If you already have life insurance, be sure to update your policy to include your children as beneficiaries. You should also name a trustee to administer the benefits until your children come of age.