Should I buy life insurance when I have a new baby?
Answer
Having a new baby is one of the most compelling reasons to review and update your life insurance. A newborn creates 18–22 years of financial dependency—including food, housing, education, and childcare—that life insurance is designed to protect.
If you already have coverage, reassess the amount. Adding a child typically increases your coverage need by $200,000–$400,000 or more, accounting for childcare costs, lost income periods, and college funding goals. If you don't have coverage, a new baby makes acting quickly important: rates are lowest when you're young and healthy.
Many parents also consider buying a small whole life policy on the child. This provides modest final expense protection, but more importantly, it locks in insurability permanently regardless of health issues that develop later in life. This can be valuable if your family has a history of health conditions.
Nevada parents should also review beneficiary designations and update them to include trusts or custodial accounts for minors—minor children cannot directly receive life insurance proceeds. A licensed agent can guide you through the right coverage structure for your growing family.
Key Takeaways
- A new child adds 18–22 years of financial dependency that increases your coverage needs.
- Review existing coverage and consider adding $200,000–$400,000 per child.
- Juvenile whole life policies lock in insurability regardless of future health changes.
- Update beneficiary designations to use trusts or custodians for minor children.
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