Life insurance for the parent without a paycheck

At a glance

What it is

Life insurance for a set period: 10, 15, 20, 25 or 30 years

Who it is for

People with a mortgage, children, or income others depend on

Price

Usually the lowest cost per dollar of coverage while the term runs

After the term

Coverage ends, renews at a much higher price, or converts to permanent coverage if the policy allows

Insuring a stay-at-home parent

A parent without a paycheck still has an economic value: childcare, transportation, household management. Replacing those services can cost tens of thousands of dollars a year. Term coverage on the at-home parent is inexpensive and commonly overlooked.

How much can a non-earning spouse be insured for?

Carriers generally cap coverage on a non-working spouse relative to the working spouse’s coverage, often at 50 to 100 percent, with fixed maximums that vary by company. Coverage is justified by the economic value of the work performed and by shared household obligations, not by a paycheck.

Choosing an amount and a term

A common approach is to add up what you want covered (remaining mortgage, years of income to replace, education, final costs), subtract what you already have (savings, employer coverage, Social Security survivor benefits where they apply), and match the term to the longest obligation. Someone with a 27-year mortgage and a toddler often looks at 30 years; someone five years from paying off the house may look at 10.