Rails after_initialize only on “new”

Putting the logic in the controller could be the best answer as you stated, but you could get the after_initialize to work by doing the following:

after_initialize :add_product

def add_product
  self.product ||= Product.new
end

That way, it only sets product if no product exists. It may not be worth the overhead and/or be less clear than having the logic in the controller.

Edit: Per Ryan’s answer, performance-wise the following would likely be better:

after_initialize :add_product

def add_product
  self.product ||= Product.new if self.new_record?
end