Life insurance for new parents

23 March 2021

Becoming a parent for the first time is exciting, unpredictable, and of course, a little daunting. Not only will you have to manage feeding, sleeping and ultimately how to balance discipline with reward, you'll have plenty of financial responsibilities too. A new baby puts life insurance on many parents’ to-do list. So if you’re not already covered, read our guide to life insurance for new parents.

Life insurance before your baby arrives

If you're pregnant and expecting your first or second baby, be assured that applying for life insurance will be no different than at any other time. Your premiums will be unaffected by your pregnancy. For more information, read our guide on life insurance when you’re pregnant.

Do I need to change my life insurance when my baby is born?

A new baby means you’ll have greater financial responsibilities – from childcare costs to clothes and nappies – so you might find that your previous life insurance cover amount is insufficient for your needs, which you may want to review. On the plus side, you may be able to increase your cover after your baby’s birth or legal adoption. You can check your policy documents to see if this is an option. Time limits and terms & conditions apply. Find out more about making changes to your life insurance policy.

Can you get life insurance for a baby?

Your baby can’t have their own life insurance policy, as policyholders must be over the age of 18, and life insurance is designed to be taken out by adults with financial dependents. However, that doesn’t mean that parents shouldn’t think about getting life insurance to financially protect their baby or older children in hard times.

When should parents get life insurance?

There are certain milestone moments when people tend to buy life insurance, and considering things before having a baby is one of them. That’s because life insurance helps you protect those who rely on your income – whether that’s a partner or a new baby. Understandably, it’s hard to imagine not being around for your children but getting life insurance can financially protect your young family if you die during the length of your policy. To protect your children in case the worst happens, you could also consider appointing a legal guardian.

The importance of life insurance for parents

As a parent you’ll face plenty of ongoing costs that your loved ones might not be able to cover without you:

  • Mortgage, rent and bills – your life insurance could mean your loved ones will still have a roof over their heads if you’re no longer around.
  • Education costs – from nursery and school fees to funding university, a life insurance payout can support your children as they grow up.
  • Hobbies – your life cover can protect any funds that support your children’s favourite pastimes, from swimming to horse riding.
  • Looking after the kids – as every parent knows, raising children is practically a full-time job on its own. Being a stay-at-home parent takes time, energy and money, and life insurance for parents is not just for the breadwinner.

What is the best life insurance for new parents?

When you have a baby, life insurance is important for the reasons we’ve outlined. But what policies should you consider to help protect your family’s future? Here's a list of the options we offer:

  • Life Insurance – is a type of policy that can help minimise the financial impact that your death could have on your loved ones. It could pay out a cash sum that could help towards the mortgage or help with everyday living expenses. The cost and the amount of cover you choose remain the same, unless you alter your policy.
  • Decreasing Life Insurance – designed to help protect a repayment mortgage, so the amount of cover reduces roughly in line with the way a repayment mortgage decreases.
  • Critical Illness Cover – can help minimise the financial impact on you and your family if you’re diagnosed with a specified critical illness. It can be added for an extra cost when you take out Life Insurance or Decreasing Life Insurance. If you do take out Critical Illness Cover, Children’s Critical Illness Cover is automatically included.

Please remember that life insurance is not a savings or investment product and has no cash value unless a valid claim is made.

What is the average cost of having a baby?

Knowing the costs associated with raising a child can help you work out the amount of life cover you need. According to research conducted by the Child Poverty Action Group in 2021, the basic cost of having a baby who eventually turns 18 is £76,167 for couples, and £103,100 for lone parents. If you add housing, council tax and childcare expenditure, the amount it costs to raise a child rises to £160,692 for couples and £193,801 for lone parents.

How much does life insurance cost?

The cost of life insurance for new parents depends on many variables, such as the amount of cover you need and your policy length, as well as your age, health, lifestyle, and whether you smoke.

If you're in a relationship, you may also be considering whether you need a joint life insurance policy or two single policies. Joint life insurance can be cheaper, but these policies only pay out once if the first person dies during the length of the policy, so you will need to consider the implications if your surviving partner is left without cover. Read our joint life insurance vs single life insurance for more information.

Learn more about life insurance for your family

Having a baby is one of life’s great adventures, and when it comes to protecting your loved ones, some things in life are simply too important to leave to chance. Discover how our Life Cover products can help protect those you care about.