Home Life insurance Life insurance basics Life insurance for new parents Life insurance for new parents Written by: Les Masterson Les Masterson Les, a former managing editor, insurance, at QuinStreet, has more than 20 years of experience in journalism. In his career, he has covered everything from health insurance to presidential politics. | Reviewed by: John McCormick John McCormick John is the editorial director for CarInsurance.com, Insurance.com and Insure.com. Before joining QuinStreet, John was a deputy editor at The Wall Street Journal and had been an editor and reporter at a number of other media outlets where he covered insurance, personal finance, and technology. | Updated on August 14, 2023 Why you should trust Insure.com Quality Verified At Insure.com, we are committed to providing honest and reliable information so that you can make the best financial decisions for you and your family. All of our content is written and reviewed by industry professionals and insurance experts. We maintain strict editorial independence from insurance companies to maintain editorial integrity, so our recommendations are unbiased and are based on a comprehensive list of criteria. Becoming a parent is a transformative experience. Your world shifts to center on the care of your new baby. That includes exploring life insurance options. Among parents’ major responsibilities is planning for the financial security of your child. Often a central component of this planning is buying life insurance. After all, if you weren’t around, would your family be able to manage without your income? In households where one person stays at home, the loss of that caregiver can have a huge financial impact in the form of new expenses, such as childcare.Here are five simple steps to a good buying decision:Calculate how much life insurance you need. (See Insure.com’s life insurance calculator.)Decide on the most appropriate policy type to meet goals (term life insurance, permanent life insurance or universal or variable universal life insurance).Choose a reputable company with a history of good customer service. (Insure.com maintains Check out Insure’s Best Life Insurance Companies.)Look at ways to save money on life insurance.Get life insurance quotes.Buying life insuranceLife insurance is sold in two main forms:Term life insuranceTerm life pays a benefit upon your death as long as you die within the term. Term life insurance is available for set periods of time such as 10, 15, 25 or 30 years.You can get level term life insurance, which charges the same premiums for the policy’s term. Annual renewable term life is another option. That one renews each year, but premiums increase over the term. One other option is decreasing term life, which keeps premiums the same, but the death benefit decreases over time.When choosing a term period, figure out the time your dependents need your income. For example, if your children are young and you have decades to go on your mortgage, try 30-year term life. If you have 20 years left on your mortgage, you may want to go with a 20-year term policy.If you get to the end of your term life insurance policy term and still need life insurance, you’ll need to shop for a new policy, which will then be priced based on your age and health status. You might be able to convert to a permanent life policy at that time. Permanent life insurancePermanent life insurance has a “cash value” account in which you can build up savings. Permanent life insurance types include whole life, universal life, indexed universal life and variable universal life.Universal life insurance policies allow you to fluctuate or even skip premium payments, which in turn adjusts your death benefit amount.Variable life offers a death benefit with a side fund that operates like an investment account. Theoretically, the cash value can go down to zero and, if so, the policy will terminate. Some variable life insurance policies will guarantee a minimum death benefit.You’ll receive a financial “illustration” of the potential growth of the cash value account, which can run to 15 or more pages. Pay particular attention to the guaranteed death benefit and premium-payment sections, because these columns contain the actual company promises.Understand what your beneficiaries will receive if you die. If you have a traditional whole life policy, your beneficiaries receive only the death benefit no matter how much cash value you’ve built up. Other payout options available for higher premiums are “death benefit plus cash value” and “death benefit plus return of premium.”Additional resourcesConsumer Federation of America’s Insurance “Rate of Return” Servicewww.evaluatelifeinsurance.orgInsurance Information Institute: Learn about life insurancewww.iii.org/lifeThe Life and Health Insurance Foundation for Educationwww.lifehappens.orgLife insurance pricesLife insurance rates are based on your life expectancy, your risk, the face amount you request and the length of the policy.Because your current and past health conditions impact your life expectancy, insurers want to know as much as possible about your health condition.Common conditions such as high blood pressure, heart disease, obesity, diabetes, cancer and depression can all raise your premiums or even result in your being declined if you have multiple conditions. Expect questions in detail regarding your lifestyle, intended foreign travel destinations, your family health history and your personal health history.Based on your medical history, you’ll be grouped into an underwriting category such as “preferred plus,” “preferred,” “standard,” and “substandard.” Your category ultimately determines your premiums.Ways to make life insurance more affordableIf you get life insurance quotes but you can’t afford them, consider these strategies:Reduce your benefit amount or term period in order to reach a price you can afford, then buy additional insurance in the future if more funds become available.Buy as much term life insurance as you can afford and supplement with group life insurance through work, if it’s available. group life insurance is the cheapest way to obtain life insurance, but you can’t take it with you if you lose or leave your job.If your spouse needs life insurance and you have group life through work, find out if you can buy group life for your spouse at the next open enrollment period.Once you do your homework and figure out exactly what you need, you can buy a life insurance policy that protects your children financially if the unthinkable happens. × Get Free Life Insurance Quotes Today! Zip Code Please enter valid zip Age Age 16 – 20 21 – 24 25 – 34 35 – 44 45 – 54 55 – 64 65+ Coverage Amount Coverage Amount $50,000 – $100,000 $100,000 – $200,000 $200,000 – $300,000 $400,000 – $500,000 $500,000 – $1,000,000 $1,000,000 – $2,000,000 $2,000,000 – $5,000,000 $5,000,000+ Coverage Type Coverage Type Whole Life Term Life Final Expense Not Sure Gender Gender Male Female Non-Binary Tobacco Use Yes No Compare Quotes Les MastersonContributor  . .Les, a former managing editor, insurance, at QuinStreet, has more than 20 years of experience in journalism. In his career, he has covered everything from health insurance to presidential politics. QuickTake Understanding your life insurance policy options How to read your life insurance policy How to find out if someone has life insurance Life insurance riders: What they are and how they work What is a life insurance beneficiary? 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