Bringing a new baby home will be one of life's most memorable events. Most people aren't thinking about life insurance or the possibility of a death in the family at this special time, but you don't want to miss the opportunity to protect yourself and your loved ones. Adjusting your insurance needs before the baby arrives can set up a cushion in the event of your death, and ensure that your little one - and the rest of the family - are taken care of. Most insurance providers only give you about 30 days or less to add the newborn to a health insurance plan so you need to make sure the baby is eligible to receive all benefits as soon as possible.
Important insurance considerations to think about before and after your baby arrives:
Estimating Life Insurance Needs
You need to know how much insurance you and your dependents actually need, so don't rely solely on an agent's recommendation at this stage. Consider how much income you and your spouse or partner are already bringing in, and determine what amount your family needs to survive if one party dies. This varies significantly by family but is an important number to have before requesting quotes.
You will also need to decide whether you want to purchase term life insurance or permanent life insurance. Term life insurance pays a benefit to your family upon your death, while permanent life insurance works more like a savings account that builds over time. You need to decide what you're most comfortable with. Make sure you update the designated beneficiary so your child will actually be able to receive insurance benefits.
Adding the Baby to Your Health Insurance Plan
You'll need to add the newborn to your family health insurance plan or group health insurance plan right away. Get in touch with your insurance company to inform them about the new addition to the family, and review all the paperwork to add the baby to your plan. Make sure you contact your insurance agent at least one week after you bring the baby home or you could miss out on some privileges and benefits. The United States Department of Labor recommends enrolling your baby within 30 days of the date of birth.
Children's Health Insurance for the Uninsured
If you don't currently have any type of health insurance and don't meet low-income rules for Medicaid eligibility, you may be eligible for a Children's Health Insurance Program from your state. Even uninsured families can get some type of coverage for their newborn and child. You will need to contact your state's insurance department for more information about this state-funded program.
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