Your Maternity Policy May Not Be The Mother Of All Policies

Babies are a piece of cake. Okay, I lied. Motherhood is super hard, but you have family to help you with the kid. You soon get used to raising a kid.

I'm afraid a maternity benefit policy is not any simpler. No amount of counting clover petals will help you decide if it does your health policy any good or not.

Group policies offered by your companies may not cover maternity expense; and if they do, they have high premiums. Individual policies do not extensively cover maternity expenses and when they do, they come after a waiting period of minimum two years. The insurance companies’ defends their stand by saying that the health insurance policies are to save individuals from unforeseen emergencies and pregnancy certainly isn’t one.

Related Article: What you Oughta Know about Maternity Insurance

Myth-breaker: Having a health insurance policy doesn’t mean your maternity is covered

To begin with, most people who have health policies are under the impression that their maternity expenses would be covered. This is because, insurance generally covers hospitalizations’ spanning 24 hours and more. This is not true! Maternity is an exclusion in most health policies and people come to know of this, sometimes after their completion of waiting period and into their pregnancy, by which it’s late to do anything.

This special corner for parents-to-be: The Maternity Corner

Let’s understand primarily, that maternity is not a policy that you can take to cover just your pregnancy alone. It is an add-on feature that can enhance your policy if you plan to have a kid in the near future, ‘plan’ being the operative word and ‘near-future’ being the subjective word.

What does a maternity benefit in a policy cover?

The maternity benefit feature in your policy could mean that -

1. Your actual hospitalization expenses for delivery is covered, be it normal or cesarean. In most cases, this accounts for the bulk of expenses incurred.

2. This feature also, sometimes, covers pre- and post-natal care which includes regular health checks, ultrasounds and medicines.

3. Some policies cover the new-born as well from day zero until the policy reaches its renewal date, with regular vaccinations and unforeseen complications that may arise during child birth. This accounts as a special coverage in a policy and you may need to clarify this at the very beginning.

What normally catches your attention in the policy

That sense of protection you may feel with your policy, especially when your planned maternity benefit is finally being put to use, yes we know. The reason you thought the policy shines are these:

1. Delivery costs are covered, but god-forbid, if something was to happen to your wife and your baby, the policy would take care of that expense without you having to worry about finances in that nail-biting-agonizing moment.

2. Your options of choosing ‘better’ treatment (read: a luxurious hospital and an expensive doctor) are more - which normally you would not have done in the absence of this policy.

But not all is hunky-dory with maternity

You may be the careful few to have taken a policy with maternity in mind or included your new wife/husband since, well, a baby will happen sometime soon. But even then -

• You will not be able to avail maternity as soon your policy kicks in. Some individual and group policies cover maternity within a 9 month period, but at very high premium cost. Otherwise, most individual policies take a minimum of 24 months before they cover maternity.

• Ceilings in coverage can majorly dampen your spirits. You could have a cover limit of Rs. 3 lakhs but doesn’t mean your delivery’s hospitalization expenses of Rs. 1.5 lakhs will be reimbursed entirely. The maternity benefit is NOT up to the limit of the sum assured value. There are sub-limits to this coverage. The reimbursement of your entire maternity hospitalization has a limit even if there is money pending in your health policy.

• If you decide to go in for an extravagant policy to cover your pregnancy wholly, it could again mean high premiums. If your policy is for Rs. 10 lakhs, the ceiling cover for maternity would be just Rs. 1 lakhs but your premium for an otherwise affordable amount would be too high since your high-cover demands it.

Verdict: Let maternity not be your deciding factor

Now that we have walked you through the star-marked facts that entail the ‘security’ you expect from the maternity feature in your policy, it’s only obvious that we would emphasize how maternity feature is NOT always a good scheme of things. And here is why:

• Essentially only delivery is covered (pre/post natal care and new-born care are subjective clauses in a policy). Termination of pregnancy or any such complications are not covered.

• The rider will not cover extensively, including the pre-and post-check-ups, ending up making a dent in the policy. And straining the cover amount and making it insufficient, defeats the purpose of an insurance policy, especially in case of family floaters.

• For an amount that is significantly less when compared to the policy’s cover limit, you may do better off when you remind yourselves that the cover’s primary purpose is to secure you from unavoidable/unfortunate health complications. Pregnancy could still take second priority, if you are wise enough to invest that amount differently, where you could use it towards your maternity in future.

Reach out to us, because we are sweet and nice and always ready to help out.