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How to buy life insurance when you're pregnant.
Adding a baby to the family is a great reason to get your financial house in order, from re-evaluating your health insurance plans to setting up college savings accounts.
Buying life insurance, which allows you to provide for your family if you die, can be an important part of your financial planning as you expand your family. But when should you apply for life insurance coverage if you are pregnant? What if you have gestational diabetes? And how can you make sure that your unborn child is protected by your life insurance policy?
Many people don’t even think about life insurance until they have children, but it’s a good idea to plan for the future by buying life insurance coverage when you’re pregnant or even before.
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Pregnant women can get life insurance coverage, with some caveats.
Insurance companies treat pregnant applicants on a case-by-case basis, so it’s impossible to say whether you can get covered until you apply. But generally, women in their first trimester who don’t have pregnancy complications, a pre-existing condition that could lead to complications, or a history of complications from previous childbirth can get life insurance coverage, and usually for the same rates as if they were applying and were not pregnant.
If you apply in your second or third trimester, it’s much more likely that your application will be postponed until after you have given birth.
Insurance companies think in numbers and probabilities, which means your life insurance rates are based on the estimated lifespan and future health risks for the average person like you, including age, sex, weight, cholesterol, and your medical history. There are two factors, especially, that can affect life insurance rates for pregnancy women: weight gain and complications.
While most insurance companies will look at your pre-pregnancy weight when setting your rates, there are some that will set your rates using your current weight. Other companies just want to see that you're gaining weight at "normal" levels and could increase rates if you've gained more than that. If you apply post-birth, many insurers will still use your pre-pregnancy weight up until six months after you have given birth, at which point you will be rated based on your current weight.
You can still get great rates in the first trimester, but if the underwriters find any of your lab results to be abnormal or anything in your medical history or lab work to suggest complications (like gestational disabilities) or a high-risk pregnancy, you’ll either be offered a policy with elevated rates or your application will be postponed until after you’ve given birth. These complications may include:
Each life insurance carrier approaches pregnancy differently, and each carrier approaches each application on a case-by-case basis. A Policygenius agent can help you choose the best life insurance company for your situation.
When you apply for life insurance, you have to take a life insurance medical exam. But while medical examiners do administer blood and urine tests as part of the medical exam, they do not test for pregnancy, and there is no way that the life insurance company will be able to tell if you’re pregnant from the results of the test.
So how does the life insurance company find out if you’re pregnant? Because they ask as part of your medical interview, and you should answer honestly if you are.
If you don’t answer honestly (for this or any other question), if you die during your policy’s contestability period, your beneficiaries’ claim could be denied on the grounds that you lied about your pregnancy.
The life insurance application process usually takes around six to eight weeks. Rates go up alongside age and the development of any health conditions, so in general, it’s better to apply sooner rather than later. Technically, though, you can apply at anytime in your pregnancy, and there are pros and cons to each.
If you’re planning on starting a family, the best time to apply for life insurance may actually be before you get pregnant. That way you ensure you get the lowest possible rates and your family is covered if you die from complications from childbirth (though the chances are extremely low, the U.S. has the highest maternal death rates in the developed world).
If you apply once you’re already pregnant, most companies will use your pre-pregnancy weight. But depending on which trimester you’re in, your application could be postponed until after you give birth (four to eight weeks after a successful pregnancy, most pregnancy-related medical conditions should have resolved themselves).
If you do end up with a higher rating due to pregnancy complications (like gestational diabetes), most life insurance companies allow you to take your medical exam again a year or two after your policy is issued. If you qualify for a lower rate, your premiums will be readjusted. This one-to two-year window gives you time to normalize your health after a pregnancy. Talk to your agent to confirm the timeline for your specific life insurance company, and mark your calendar to follow-up in a year.
If your application is postponed when you apply during your pregnancy or if you’d like to wait to apply until your rates will be lower, the four-to-eight weeks after you give birth are the next best time to apply.
By this point, your weight will likely be lower than it was during your pregnancy and any health complications from pregnancy, including elevated blood pressure and cholesterol, should be resolved.
You should note, however, that post-partum depression and gestational diabetes can elevate your rates for five years after you experience them. Another reason why the best time to apply is before pregancy or during the first trimester.
Life insurance riders, also called floaters or endorsements, are optional additions to the terms and conditions of your life insurance policy. Common riders include the ability to convert a term policy to a whole policy or getting access to the death benefit early if you become disabled or terminally ill. There are many life insurance riders to consider, and your life insurance agent can help you pick which ones make the most sense for you, but there are a few that are especially good if you’re buying life insurance in anticipation of a new baby.
Child riders include protection in the event that anything happens to your children. Considering funeral costs can top $8,000, the loss of a child can be devastating financially as well as emotionally. Child riders can help take one of those hardships off of your hands.
A child rider essentially allows you to purchase life insurance for your children in "units" of $1,000 at an average annual price of $5-7 per unit. So if you wanted $10,000 worth of protection, that could add $50 to the annual cost of your life insurance policy, or around $4.17 to your monthly premium.
Most child riders are eligible to start when your child is around two weeks old and the term ends when they turn 18 (although some can last until your child is 22 or 25). Best of all, a single rider can cover all of the children in your household.
There are some pros and cons to child riders. On the one hand, it can help pay for funeral expenses and is typically a much better deal than buying a separate policy for your child, which is usually an expensive, unnecessary whole life insurance policy.
On the other hand, life insurance isn’t really needed for children in general. Life insurance is typically used as income replacement when the primary breadwinner dies which, obviously, doesn’t apply to your kids. In a lot of cases it’s just an extra cost.
Life insurance is income replacement for when you die. But what about when you need income replacement because you’re just injured? You’ll still need money coming in to pay for your child’s needed until you get better.
That’s where long-term disability insurance comes in. Long-term disability insurance is important because one in four workers will become disabled before they retire. A standalone long-term disability policy is usually your best bet in terms of the amount of coverage you can get – a good policy will get you close to your take-home pay – but a disability income rider can add a little extra protection to that life insurance policy you’re buying anyway. We can help you get a free long-term disability insurance quote.
If you don’t have long-term disability insurance or you can't afford it right now, adding disability income rider to your life insurance policy can help.
If you have a baby on the way, there’s a good chance you have a significant other in the picture. If that’s the case, consider a spousal rider to offer him or her protection, too.
A joint life insurance policy is a possibility, but it’s not really the best option because of the expense (it’s usually a permanent policy, so it costs more than term life insurance) and it can get confusing when you get into the difference between first-to-die and second-to-die policies and what to do if there’s a divorce.
Buying a separate term life insurance policy for your spouse is usually the wiser choice, but the alternative is including him or her as a rider on your own policy – as long as you make sure you know exactly what the rider is adding. For example, some will let you add an additional level term policy to your own policy that will expire when yours does. Others offer "the right to purchase a new paid-up life insurance policy on his or her life, without providing evidence of insurability" but only in the case of the policyholder dying first.
Read more about the options for shopping for life insurance with a partner.
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When you apply for life insurance, you need to assign a beneficiary, and many people want to name their children as the beneficiaries on their insurance policy.
Naming a minor of your life insurance beneficiary is technically possible in most states. In community property states, you are legally mandated to name your spouse as the beneficiary of your life insurance policy, but if you don’t live in a community property state, you can write in any name on the beneficiary line. Some companies will even allow you to denote your beneficiaries as “all children in equal shares,” which means that you don’t have have to update your policy as you have additional children.
But most lawyers and financial planners will deter you from naming a minor as your life insurance beneficiary because it would automatically trigger a court getting involved to disperse the benefit, which could tie up the funds for years and lead to unnecessary legal fees.
There are several ways you can make sure your death benefit goes to your kid without getting a court involved: you can name your spouse or a legal guardian to oversee the funds on behalf of your children or you can create a trust or a Uniform Transfers to Minors Act (UTMA) account. Both are accounts set up for just this situation, and both require a lawyer’s help to set up. A lawyer will be able to help you decide which is right for your situation and write up the documents.
Learn more about naming a minor as a life insurance beneficiary.
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Yes, we have to include some legalese down here. Read it larger on our legal page. Policygenius Inc. (“Policygenius”) is a licensed independent insurance broker. Policygenius does not underwrite any insurance policy described on this website. The information provided on this site has been developed by Policygenius for general informational and educational purposes. We do our best efforts to ensure that this information is up-to-date and accurate. Any insurance policy premium quotes or ranges displayed are non-binding. The final insurance policy premium for any policy is determined by the underwriting insurance company following application. Savings are estimated by comparing the highest and lowest price for a shopper in a given health class. For example: for a 30-year old non-smoker male in South Carolina with excellent health and a preferred plus health class, comparing quotes for a $500,000, 20-year term life policy, the price difference between the lowest and highest quotes is 60%. For that same shopper in New York, the price difference is 40%. Rates are subject to change and are valid as of 2/17/17.
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