When you become a parent the word “responsibility” takes on a whole new meaning.
Yes, you may be used to having responsibilities before you have children: responsibility to take care of your health, get a job and provide for yourself and possibly a significant other, and other responsibilities such as paying taxes or going to the dentist regularly.
When you have children, though, you not only have the responsibility of taking care of yourself but you are solely responsible for making sure a child has the best possible opportunity to succeed in life. In short: you need to provide for them and make sure they are taken care of no matter what.
Thankfully insurance helps take care of a number of these responsibilities.
Health Insurance
In my opinion health insurance is the most important insurance you can have. Having health insurance allows you to take the fear of bankruptcy and overly-expensive medical bills get in the way of pursuing the medical care you need. When you have children it becomes even more important that you are proactive about getting health insurance because your children rely on you to manage their health. It’s not fair to them to go without the care they need because of a lack of insurance.
If you live in the United States, consider getting a plan with an HSA and avoiding the catastrophic plans. If you live in a country that has universal health coverage, health insurance is one type of insurance that the government takes care of for you.
Auto Insurance
Even if you don’t have children you should still always make sure you have adequate auto insurance. First of all, in many countries it’s illegal to drive without auto insurance. Even if you do have insurance there can be a wide range of coverage from ‘bare-bones’ policies to policies that have a high level of coverage. It’s important to know what you are and are not covered for in order to have a full understanding of the risk you are taking on.
Being a parent means you will have young drivers in your family at some point. This brings up a whole other insurance issue as to what sort of insurance you need to cover your young drive. Some companies like the UK company Insure Learner Driver you can get short-term coverage for drivers that are learning to drive.
Life Insurance
While you may have considered or even gotten a life insurance policy to protect your significant other, you will definitely want to get a policy once you have children. If an unexpected and unfortunate situation happens where you pass away prematurely, you can be assured that your children will have the finances they need as they are growing up.
There is a wide variety of life insurance options available, and pricing will depend on a variety of factors. Generally the earlier you get life insurance the better. You will also have to choose between whole and term life insurance. Do your research and get a few different quotes before signing the dotted line.
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David,
I would also recommend disability insurance to protect your income. In terms of life some parents take them out on children under the recommendation of an agent. You don’t rely on your children for income and it’s a waste of money as they 99.9% will get cheap insurance in their adult life.
Charles@gettingarichlife Disability insurance was another one I was going to add! Definitely an important insurance to consider if you have children (or even if you don’t).
As far as taking out life insurance on your children, I haven’t really thought about that before or read much about it. I can see why agents would suggest it, though, as they are getting paid on commission most of the time.
Ditto the disability insurance. As a friend of mine once said: “I’ll get disability insurance first, because if I’m not covered, I’ll be around to see the fallout!” Granted, he isn’t married — so, thinking about the fallout of leaving his family destitute isn’t nearly as upsetting to him!
I think these are definitely things almost everyone should have, even those that are married without kids. I would hate to leave my wife in the lurch because I didn’t spend a couple of hours preparing.