was my MIL actually insensitive or am I just sensitive??

So it's Sunday and football Day my SO has a tradition of hanging up all the football shirts and jerseys he has. We decided to hang up our daughters football onesies we have since she's not born yet. My MIL come s in and is like awwe you hung up the baby's stuff. And my SO goes "yeahh she's here in spirit!" I go "haha no she IS here!" My mil says, " yeah what the heck she is still here unless she died or something and you didn't tell me " Omg that put me off so bad. I'm a normal paranoid pregnant lady, why do you think that is okay to say??? I didn't say anything back I just shocked she wouldn't even say something like that, joke or not