New parent or parent to be? Here’s what you need to know to about personal insurance

ARTICLE

4 March 2026

4 mins read

If you’re a first-time parent, your whole life has changed and you’ve got a million things to think about – so it helps having peace of mind that your little bundles of joy are protected if something happens to you or them.

As new parents or parents to be, there are a few insurance considerations you may want to think about at this time.

Protecting your family and your income

Your growing family needs income if something happens to you or your partner, because you both play important roles in the family that would cost money to have someone else fulfil.

Make sure you and/or your partner consider life insurance that can cover your mortgage and expenses if something happened to either of you, plus income protection if one or both of you couldn’t work.

Primary carer not planning to work?

It’s important not to forget the cost of the primary carer if they weren’t around and ensure you or your partner (whomever is doing that role in full or part) is covered.

A nanny would need to be paid for, or the other partner would need to stop work to care for the child or children. Who would do the shopping, prepare meals, clean and drive to health care appointments or school? These are all expenses that are commonly overlooked, as well as lifestyle changes that the secondary carer would have to make, if the primary carer wasn’t around.

Taking parental leave?

If you’re planning on taking parental leave, here’s some practical information about what happens to your insurance cover when you’re away from work.

Paid parental leave with employer super contributions generally keeps your insurance cover active.
If contributions stop during unpaid leave, your super insurance may change or cease unless you take steps to maintain it.
Income protection through super can be reduced, altered, or cancelled when no contributions are received, and it typically won’t pay after 12+ months of unpaid leave.
It’s a good idea to contact your super/insurance provider or a financial planner to confirm your cover is protected.

Health Insurance

If you’re planning to start a family you may wish to consider private health cover for a private obstetrician and birth. Making sure you have cover to pay for dentist appointments, ambulance fees, optical and other treatments such as speech therapy and physiotherapy for you and your kids, is important. Having health insurance makes sure some of these costs are covered, and if your income is above a certain level, it can help you avoid paying extra Medicare costs at tax time.

Calculate how much you might need

According to research released by the Australian National University in 2025¹, families spend approximately 13% of their disposable income on the first child and a further 10% for each subsequent child. For a couple earning an average $130,000 per year after tax, this equates to about $17,000 per year for the first child.

The report notes that while lower income families spend a lower amount on their children, this represents a higher share of their income.

Next steps

Talking to a financial planner can help you understand your situation and make confident financial decisions (big or small) so you can get the most out of life.

Reference

¹ Cost-of-children-and-the-adequacy-of-family-payments-Final.pdf and https://www.sbs.com.au/news/article/cost-of-raising-children-in-australia/u83g69rcz

Disclaimer:
Copyright © 2026 AIA Financial Services Pty Limited (ABN 68 008 540 252, AFSL 231109), trading as AIA Financial Wellbeing. All rights reserved. This information is current at the date of this publication and is subject to change. This provides general information only, without taking into account factors like the objectives, financial situation, needs or personal circumstances of any individual and is not intended to be financial, legal, tax, health, medical, nutritional or other advice. Before acting on the information in this publication, individuals should consider its appropriateness having regard to such factors.