Adding a new baby to your family is a wonderful experience. But with the joy comes long-term responsibility, so your awe is tinged with concern. Of course you will do your best for your child for as long as you live, but what if something were to happen to you? That’s when you start wondering about life insurance for young parents. You’re on the right track. To help your thoughts along, let’s investigate life insurance for parents, why you need it, how your needs may change, and how long it remains a concern.

Why Life Insurance is Important When You’re a Parent

Naturally, you want to give your children the best start in life that you possibly can. That means a happy and secure home environment and a good education.  But life happens, and we don’t know what tomorrow may bring. If you were to die, your passing would have further-reaching effects than the loss of a beloved parent, particularly if you’re the breadwinner or make a substantial financial contribution to household finances.

There are several issues that your surviving family members might face. There’s the loss of your regular income; the matter of a mortgage that must be paid to keep their home; and your children’s education costs as they near adulthood and prepare for their entrance to the job market. These are all things you can cover with a life insurance benefit - provided you find the right insurance policy.

Term Life Insurance for New Parents

There are two broad categories of life insurance: whole life insurance and term life insurance. Whole life insurance will pay out your death benefit when you die, no matter how near or far away that date may be. Term life insurance covers a set period, for example, 20 years. If you were to die after the term ends, there would be no death benefit unless you began a new policy when the old one ends.

When seeking life insurance for parents, UK adults often believe that whole life insurance is the only real option. But you should pause to consider. We’ve just looked at the reasons why life insurance for new parents becomes a priority. We’ve seen what needs it may address. Will those needs remain the same? Obviously not! Children grow up. Mortgages get paid. Your family’s financial needs change.

Now, let’s look at it from an underwriter’s perspective. If there’s one thing that’s certain, it’s that you will die sometime. Whole life insurance means that your insurance company will definitely have to pay out a death benefit at some time or another. As a result, they must charge higher premiums for less coverage. With term life insurance, there’s a chance you’ll outlive the term of your insurance policy. That means that insurance companies aren’t betting on a certainty, and can offer you lower premiums for better cover. This brings us to the next question.

How Long Do I Need Life Insurance?

If you’re considering life insurance specifically because you’re a new parent, consider your goals. What would you want that death benefit to do, and for how long will that need continue to exist? These questions help you to determine how much your death benefit would be and it would indicate an expected timeframe in which you require cover. But what if you were to add more children to your family? It’s usually possible to renegotiate your policy based on your changing needs.

Of course, it’s nice to leave an extra benefit for your family even if you were to live to be a hundred, but it’s likely to be less necessary, and the amount needn’t be as high once your children are grown and your mortgage is settled.  Life insurance for young parents has to cover higher-value expenses and a wider spectrum of needs. Among older people, a lower death benefit won’t usually jeopardise the family's future.

The most economical and effective strategy? Term life insurance that covers your family’s needs during the time when their needs are greatest. You can always reinsure yourself for a lower benefit, and a lower premium, after that. If you were to die during the period covered by your term life insurance, they get the best you can provide for. Later on, the need is less pressing, and you can reduce both cover and its costs.  

The Cost of Life Insurance for New Parents

As we’ve seen, term life insurance means lower-cost, better cover over a period when family needs are cost-intensive. Regardless of the type of cover you prefer, most insurance companies are eager to offer life insurance for parents. As a new mum or dad, you’re in the prime of your life, and they aren’t expecting a claim anytime soon. However, there’s one exception.

People with pre-existing conditions, even manageable ones like Type 2 diabetes, often struggle to get life insurance in exchange for reasonable premiums - if they can get cover at all. That’s when it’s time to check out insurance from Blueberry Life.

We customise our insurance policies for people with chronic conditions based on a few simple indicators. We don’t do the Diabetes type 2 knee-jerk reaction that boxes you in as “chronically ill” even when you aren’t. We don’t expect you to share medical records or get doctors’ reports and then take months making up our minds about whether we want to insure you. Best of all, we offer competitive premiums that are easy on your budget.

Experience the difference with specialist life insurance for chronic conditions from Blueberry Life. It’s the right thing to do because we do right by you. It’s as easy as filling out an online application- all you need is 5 minutes to tell us about yourself.

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This is a blog and should not be taken as financial advice.