On a Sunday in February, Sheri (my wife) and I had breakfast at Cindi’s Deli in Dallas with Jordan & Christine (my son and daughter in law). The two of them were in town and this gave us some nice time together and to catch up. They presented us with a Valentine’s Day card that happened to have a picture of a sonogram showing they were expecting their first child. I was completely caught off guard but incredibly excited for them and us. This is the first Wise grandbaby and I’m thrilled!
Jordan and I were texting over Memorial Day weekend as he and Jonathan (my youngest son) were putting together the crib. I loved the picture Christine sent me of the men at work. Jordan suggested a blog topic that’s very appropriate given that this baby will arrive in September. His suggestion was framed in the question, “We’re expecting, what do we need to do with our insurance?”
In honor of Jordan and Christine soon becoming new parents, here are four insurance related items I suggest you examine.
- Home & Renter’s
Home and Renter’s Insurance: Having a baby means you’re about to acquire a lot of stuff! There are:
- Pack and Play
- Changing table
- Decorative items
- Car seat
- Carriers – Baby Bjorn, slings, packs, etc.
- Toys, books & music
Whether you’re a home owner or a renter, review your contents or personal property coverage on your home owner or renter’s policy to make sure you have enough coverage to replace the new items in the event of a total loss.
Life Insurance: A new arrival means if you haven’t bought your own life insurance, it’s time to do so. But before you go shopping for life insurance the two of you need to get together and answer these three questions first.
- What do you want the money to do?
- How much will it take to do that?
- What can your budget handle?
Answering these questions will provide you with a framework to evaluate your options and determine what’s realistic given your budget. In addition:
- If your employer provides life insurance as a benefit, increase that to the maximum allowable benefit.
- This is less expensive than a personal policy and should not take the place of your own policy. Consider this the “icing” and your personal policy the “cake.”
We don’t have to look too far to see that people are still being laid off to realize that an employer provided policy should not be the foundation of your life insurance.
Lastly, both parents should have their own policy, not just the one with the highest income. This enables the surviving parent to pay for childcare, after school care, pay off the house or whatever is needed without the benefit of the support of the other parent.
Car Insurance: Most people don’t think of car insurance when a baby’s on the way, but this is a good time to review your limits of coverage. Here are four things to consider:
- Review your liability coverage to make sure you have enough to cover you if you’re in an accident and you’re at fault.
- Review your uninsured and underinsured motorist coverage to make sure you and your family is covered if someone hits you, they are at fault, and they either don’t have insurance or don’t have enough insurance. This can help with medical bills.
- Review your personal injury protection (PIP). This is an invaluable coverage that can help pay the deductible on your health policy or cover you if you can’t work for a few weeks or longer. If you already have it, look at increasing it to a higher level.
Health Insurance: Health insurance is going through a huge change as The Patient Protection and Affordable Care Act (PPACA) is implemented. Truthfully, most people, even those in government and the health insurance industry, are still trying to determine how this impacts them. There is more misinformation out than accurate information and it will be a bumpy implementation.
With that in mind, it’s time to find out how it impacts you and your new arrival. Here are four things to review:
- What will it cover for prenatal exams and what will it not cover?
- What does it cover for the labor and delivery?
- When is your child covered?
- What coverage is provided for your child (well baby exams and if newborn is premature or sick)?
In most employer plans that utilize a traditional PPO or HMO approach, you may not notice much difference however you still can be able to answer these questions. Review these items with your human resources representative, as well as with your insurance provider.
Many employers have moved to health savings accounts. If that is the case for your employer:
- Know your deductible as it’s probably higher ($5,000 for a family plan is common)
- Know the co-pay
- Be sure you or your employer is adding money into the savings account
If you’re self-employed and your spouse or partner does not have an employer provided plan, you’re probably aware that maternity coverage is usually not available on individual policies. Work with your physician, mid-wife, hospital or birthing center to determine how you can pay and what the amount will be.
This is an exciting time for both of you and your extended family and friends. Enjoy picking out color schemes, decorative items, clothing and picking names. Revel in your baby’s movement and development as you dream of your lives. But also take some time to make sure you’ve covered your bases on your insurance too!
Share your comments, experiences and questions with us in the comments section of our blog or on our Facebook and Google + pages and my wife will knit a pair of baby booties for your special little bundle. I’d love to hear from you!