Maternity Insurance Plan – 5 Things to Consider Before Buying
Meaning of Maternity insurance
The term maternity means the state of becoming a mother. It is believed that when a woman is becoming a mother, it brings joy to the entire world, and so the woman who is going to spread this joy shall not be stressed about minute details and challenges. For such purposes, the maternity insurance plan was introduced. Normally, the costs that basic maternity insurance covers include pregnancy, labour, delivery, and newborn baby care.
When a woman is pregnant she is in the stage of motherhood and it is considered the most beautiful stage in a woman’s life. During such times, the person shall not be exposed to any stress as it is believed that stress affects the child too. Therefore, the maternity insurance policy helps a woman be financially stress-free.
Major features of maternity insurance
- In-patient hospitalization
Once pregnant women enter labour, it is understandable that the woman needs to be given admission to a hospital as the delivery process must begin without any delay. Delivery, labour, maternity costs are coverable under a maternity insurance policy.
- Claim process
On admission of the pregnant woman to a hospital, the insurance company has to be immediately kept in the loop on the admission and the progress thereof. The process will begin with the hospital verifying and sending the required documents to the insurance company. Some of the documents that need to be submitted while filing a claim are – filled and signed claim forms, policy documents, original hospital bills Etc.
- Tax Benefits
A maternity insurance plan qualifies for tax exemption under section 80D of the Income Tax Act. That means the premium paid on such maternity policies is deductible up to a limit of Rs.25,000 per financial year from the income of the person paying such premiums.
- Cashless facility
If the insured gets admission into a hospital within the network of hospitals under the insurance company then the policyholder can enjoy the benefit of cashless treatment. The insured must normally inform the insurance company immediately on admission and from then onwards, the insurer will take the due process forward.
- No-claim bonus (NCB)
After purchasing a maternity policy, if the woman does not file any claim for a whole year, then after one year, she can file a no-claim bonus for not filing a request the entire year. Normally, the NCB is implicit in such policies as such policies have a minimum waiting period of 3-4 years. During such a period, the insured continues to earn NCB.
- Standalone policy or as an add-on
A maternity insurance policy can be used as a policy separately or as an add-on to the existing health insurance policy. Both the models are acceptable and the individual can choose the plan according to their unique needs.
Factors to be considered before purchasing maternity insurance
- Premium and coverage:
The premium is usually high as maternity insurance has a claim-settlement ratio of nearly 100% as almost everyone taking the policy will claim at some point. The installment payable as premium varies based on whether the insured has a base health policy or not. Factors such as the age of the mother, background of critical illness, any genetic disorders, risk profile of her occupation, nutrition levels, etc are taken into consideration while calculating the premium. The coverage includes pre-and post-hospitalization, ambulance charges, consultation fees, room rent and stretches right up to vaccination, and the complete inoculation schedule of the newborn for the first few years. Coverage for cesarean section delivery is also reimbursable as it is covered under a maternity plan.
- Waiting period
The waiting period in maternity insurance is a very tricky part. Once you purchase a maternity plan, you have to serve a waiting period of a minimum of 9 months and you cannot file a claim just after purchasing such a policy. Actually, the waiting period can be much longer. The waiting period differs from one person to another, based on the health condition of the insured. If the woman mentions having certain health issues then the policy premium payable increases as the insurer will presume that during delivery, the woman may face certain complications. The general waiting period for maternity plans varies from 3 to 6 years.
- Newborn coverage
The newborn baby requires constant care for which the doctors prescribe a complete vaccine schedule. The cost of the vaccines and other important care expenses are under the coverage of a maternity insurance plan. The newborn will be receiving a minimum coverage of 90 days post-birth. However, the actual coverage can vary from one plan to another.
- Plan Exclusions
There are certain expenses that are explicitly excluded from the list of admissible costs under a maternity policy. Expenses spent on various tonics and vitamins prescribed by the doctor, doctor’s daily check-ups, consultation fees of a doctor during the 9 months, treatment of infertility are few examples of costs that are not under the coverage of a typical maternity insurance plan. In addition, if the insured gets pregnant while serving the waiting period, the insurance company is not liable to pay expenses to the woman. Coverage is the liability of the insurer only once the waiting period is served.
- The right time to buy maternity cover
That is a million dollar question; what is the right time to buy maternity insurance. The right time to buy maternity insurance is only after the couple has pre-planned their future ahead and how they can manage a child; while not keeping their other goals aside. The child should be pre-planned. A woman is advised to purchase maternity insurance at an early age. It helps the woman to have sufficient time to serve the long waiting period that is normally a condition in such maternity plans. Newly married couples that are planning to have a second child should ideally purchase this plan after having the first one.
The premium of maternity insurance
Before choosing the best maternity insurance plan to cover pregnancy costs, it is necessary to make an elaborate and appropriate cost-benefit analysis.
The premium for maternity insurance is usually higher compared to individual health insurance as the claim-settlement ratio is very close to 100%.
The age of the woman along with her medical history, her family medical history and the health condition of the mother and the father is normally taken into consideration while deciding the premium amount.
As women get older, the premium for maternity insurance keeps on escalating as the risks are perceived to be higher.
Lesser-known facts about maternity insurance
Here are some lesser-known, yet interesting facets of maternity insurance:
- Maternity health insurance covers admission costs for an average period of 30 days and post-hospitalization expenses for a term of 60 days. The expenses involved within these days are delivery expenses, pre-natal and post-natal expenses.
- The most common waiting period a woman needs to serve varies between 3 to 6 years, and thus it is advisable to purchase a plan when you are newly married so as the maternity waiting period is served until you are ready to conceive.
- It was an early estimation that the costs involved during pregnancy were an average of Rs.35,000 but with a change in the lifestyle of today’s culture a woman may face severe complications, thus purchasing maternity insurance help.
- Many people tend to save money for a future child in advance, and thus such a plan works well in their favour and is also more economical.
- The optimum age for purchasing maternity insurance is around 25 years of age because a buffer never really hurts.
- It is assumed that with the passage of time, individuals become prone to diseases, and thus policies are more expensive for older people. In the case of maternity insurance, it is considered that with the increasing age of the woman, the chances of complication during pregnancy increase.
FAQs: Benefits of Buying Maternity Cover
Is it possible to purchase maternity insurance along with health insurance?
Yes, it is possible. It is advisable for a woman to purchase maternity insurance along with basic health insurance as this helps and acts as a top-up for maternity expenses. Maternity costs are claimable under health insurance. On the other hand, health insurance pre-decides and sets a sub-limit on different types of expenses, and thus, getting broader coverage is possible under a separate maternity plan. The costs spent on maternity have increased with better quality services being offered, and as a pregnant woman has all the right to enjoy the benefit of these services, the costs shall also be covered, ensuring mental peace.
Name some of the best maternity insurance policy providers.
Some of the top maternity insurance providers are –
2. Royal Sundaram
3. Apollo Munich
4. Star insurance policy
There could be more and you need to make a choice. Remember that the definition of the best policy is very subjective as the requirements and expectations from a policy differ from one person to another. Some factors to be considered in a policy are as under.
1. Geographical location matters because apart from a good and affordable maternity insurance policy, access to hospitals is also important.
2. Check which of the plans is most affordable
3. Look for the one with the highest coverage being offered.
4. In short, look for value for money.