Couples Underestimate Life Insurance Coverage Needs When Children Join the Family

Marriage appears to be a catalyst for working men and women to obtain life insurance protection. However, when children enter into the equation, it appears that parents are not adjusting their life insurance coverage to accommodate this new life stage. MetLife’s 10th Annual "Employee Benefits Trends Study"that about half of single working men and women without minor children have some amount of life insurance, a percentage that climbs to 72% for married workers without minor children but only increases marginally, to 75%, for married couples with youngsters. This is despite the fact that life insurance is provided by many employers as a workplace benefit. 

For those parents who do have life insurance coverage, it is important to make sure that the coverage amounts purchased before parenthood are still adequate. Of concern, the MetLife study found that workers both with or without minor children have, in general, only about three times their annual household income covered by life insurance. This amount may be inadequate with the addition of children as the number and age of dependents should be taken into consideration when determining the amount of coverage needed.

Marriage is a significant life event, and clearly, couples recognize the importance of putting life insurance on the to-​do list. However, as busy as couples are when children arrive, it is critical to take the time to increase their life insurance protection because the number of dependents relying on their incomes has also increased. Life insurance can ensure plans for a child’s future remain secure by providing funding for college and other necessities should a parent no longer be able to do so,” says Stephen Pontecorvo, vice president, Group Life Products at MetLife. “Getting more coverage is likely easier and less expensive than many people think. A healthy 35-​year-​old purchasing insurance through an employer may pay as little as a dollar a day, less than a cup of coffee in many places, for a half million dollars in term life insurance coverage.”


Having an adequate amount of life insurance coverage is critical when raising a child. According to the United States Department of Agriculture, middle income families with a child born in 2011 can expect to spend $235,000 over 17 years. This figure does not include college tuition, room, or board, which, according to the National Center for Education Statistics, in 2010 cost an additional $32,475 a year for a four-​year degree at a private university or $14,870 a year for a public university.

[Source:  "Employee Benefits Trends Study."  Metropolitan Life Insurance Company (MetLife).  5 Sept. 2012.  Web.  7 Sept. 2012.]