Life Insurance For "Non-Working" Spouses

Generally, when people think of life insurance, they think of insuring the potential income that will be lost when that individual passes away. However, serious consideration must be given to not only to lost income, but the amount of money it will cost to maintain the household when one member dies.

A stay at home parent can be overlooked in terms of financial planning. While technically there is no loss of income, there will be a significant increase in expenses if the caregiver should suddenly die. Therefore, we highly recommend that both parents carry life insurance, not only to protect the family assets, but also to ensure that it is financially possible for the surviving parent to provide quality care for the children.

In planning for the amount of insurance for the stay at home parent, ask yourself (and your spouse) these questions:

• How long would I plan to take a leave of absence from work in order to make the transition smoother for my children?
   
• What kind of care would be best for my children? A nanny, housekeeper, daycare? Remember that these needs will change as your children get older, so this issue needs to be revisited every few years.
   
• Have we made the appropriate arrangements to ensure quality education for our children?

Talk to your spouse about how best to care for your children in the event of the death of the stay at home parent. Your insurance agent is a great resource in helping determine the amount of life insurance you will need in order to meet your projected needs. It is a good idea to remember that as the cost of living goes up, you should re-evaluate your needs every few years to make sure that you will be insured in the amount necessary to allow for the best care possible. Consider using our online insurance calculator to see how much term life insurance is required to cover your needs.

NOTE: Blue Vision from Ontario Blue Cross offers disability insurance to stay-at-home spouses. Contact us for more information.