Taking Pd di-imine catalysts as an example, we use first principles density functional theory (B3LYP/6-31G*) to investigate the chain propagation steps for polymerization of polar monomers. We start with the complex formed from insertion of ethylene into the polymer chain and consider insertion into the Pd-C bond for each of four polar monomers: methyl acrylate, vinyl acetate, vinyl chloride, and acrylonitrile. We find 2,1-insertion is favored in each case (by 3 to 5 kcal/mol), resulting in a product with a strong interaction of the polar group for the growing polymer chain with the metal. Next, we insert another unit of the same polar monomer or an ethylene unit (except for acrylonitrile). We optimize the structures for all important intermediates and transition states using a continuum dielectric to account for solvation effects. These studies pinpoint the critical difficulties in designing catalysts to polymerize polar monomers.