All You Need to Know About Maternity Coverage in Health Insurance

Well, Nikita and Amit is not the only couple struggling with their finances during the most precious moments of their parenthood. The cost of healthcare is skyrocketing in India each passing year. While there has been an increased awareness about buying a health insurance policy in the Covid-19 era, most health insurance plans come with various terms and conditions related to maternity coverage that a potential policyholder must be aware of.

This article elucidates everything you need to know about maternity coverage in health insurance.

Your budget must account for maternity-related expenses from the initial phase of pregnancy. With skyrocketing medical costs worldwide, the expenses of a normal delivery in a decent private hospital in India can range anywhere from Rs 50,000 to Rs 2 lakhs and c-section delivery can cost up to Rs 4 lakhs, depending upon the location and the facilities offered by the hospital.

Moreover, the initial OPD expenses can go up to Rs 1 lakh or even more, depending upon the complexities of the pregnancy. Savings and investments are two ways you can financially build a nest egg for maternity and after. However, without sufficient maternity insurance, medical expenses can put a dent to your finances.

What is Maternity Insurance?

Maternity insurance is a type of health insurance that provides financial coverage during pregnancy and childbirth up to the sum insured under the policy term. It typically includes medical expenses listed below:

• Pre and post-hospitalisation expenses

• Pre and post-natal expenses

• Delivery expenses (normal as well as C-section)

• Ambulance charges

• Hospitalisation charges (including room rent)

• Cover the newborn baby for up to 90 days

• Medically required pregnancy termination

• Infertility treatment expenses

• Pregnancy complications

• Doctor and anaesthetic consultation

Depending upon your insurer and the plan you opt for, your health insurance policy may or may not cover the following expenses:

• Pre and post-natal expenses

• IVF treatment expenses

• Ectopic pregnancy

• Stem cell harvest

• Pre and post-hospitalisation expenses

• Consultation fees

• Medical tests before delivery

• Periodic check-ups

• Surrogacy

• Hospital cash benefit

• Maternity expenses after two children

What are the eligibility criteria for buying Maternity Insurance Coverage?

Parenthood is one of the most important chapters of many individuals' lives, and bringing a child into the world brings joy and responsibilities. With so many things to prepare for while taking care of yourself during pregnancy, the one thing that you should definitely not worry about is the cost of medical support during pregnancy and childbirth.

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Keeping this in mind, most health insurance companies offer maternity insurance or maternity cover to women from 18 to 45 years of age. Maternity insurance typically comes with a waiting period of 9 months to 60 months. However, take note that the eligibility may vary from insurer to insurer and the plan/add-on you choose.

Here are a few things you must know about Maternity Insurance Coverage:

• Many insurers offer maternity benefits in their basic family floater health insurance plan. Some insurers offer maternity coverage as an add-on with their standard health insurance policy, which also is quite an easy and affordable way to get maternity coverage.

• If you cannot buy it well in advance, you can buy a separate maternity insurance plan, which will be slightly more expensive than buying a standard policy with add-on cover. However, you need to do proper research before buying exclusive maternity policies, as not many insurers offer them in India.

• Maternity insurance without a waiting period is not easily available in India. It usually has 9 months to 5 years of waiting period, depending upon the plan.

• Generally, 30 days pre-hospitalisation and 60 days post-hospitalisation expenses are covered under the policy.

• The list of inclusions and the list of exclusions play an important role in a maternity insurance plan as they can largely vary from insurer to insurer. Therefore, it is advisable to carefully check these lists before buying the policy.

• The maternity coverage is not unlimited under the plan. For the premium you pay, you can claim up to the sum insured that you had chosen at the time of purchasing/renewing the policy.

• Most maternity insurers in India cover up to only two childbirths.

Why is it important to have maternity coverage before planning to start a family?

Here are some of the reasons why everyone should have maternity insurance coverage before planning to start a family in India:

1. The cost of delivery is very high:

Nowadays, everyone wants the best for their child right from birth. As we already discussed, the cost of a caesarean/C-Section and normal/natural delivery in a decent private hospital is very high. The total expenses can range anywhere from Rs 50,000 to Rs 4,00,000, depending on the type of delivery, facilities provided by the hospital, and location. Maternity insurance gives you financial relief, and you can enter into parenthood without unnecessary financial stress.

2. It provides maximum coverage:

Pregnancy and childbirth can be very stressful, and in many cases, some extreme pregnancy complications can lead to a miscarriage or medically required pregnancy termination. In some cases, the mother's life can be in danger, and the cost of the treatments can be exorbitant. The maternity insurance policy extends its coverage to almost all pregnancy and childbirth-related expenses. Moreover, it also provides cover to a newborn baby for up to 90 days from birth.

3. Extends its coverage to the newborn:

Premature birth is not a rare condition. The babies that are born prematurely need to be placed in incubators at the hospital's Neonatal Intensive Care Unit (NICU) for a certain period. The average NICU cost for babies weighing less than 1000 grams is Rs 1,68,000. But fortunately, a maternity insurance plan covers the newborn baby from day one to 90 days. The insurer covers all the expenses arising out of any complications with newborn babies. Moreover, some policies also cover the vaccination costs for babies until the end of the policy.

4. Cashless Hospitalisation:

Most maternity insurances come with a cashless hospitalisation benefit. A cashless hospitalisation feature lets you pay only the deductible amount (if any), and the insurer pays the bills directly to the hospital. So, you do not have to worry about paying the hospital bills through cash or credit and then waiting for the claim settlement. To take advantage of this facility, you must visit the network hospital of the insurer and provide the hospital with your cashless insurance card or the original insurance policy.

5. No Claim Bonus:

If you do not file a claim during the policy year, the insurer rewards you with a 'no-claim bonus'. The no-claim bonus can be rewarded in the form of a discount on the next policy premium or a 10% increased sum insured for the next policy year. These bonuses can be accumulated over the years and even transferred to the new insurer if and when you want to change your current insurer.

6. Tax Benefits:

Like any normal health insurance, you can avail of tax benefits against the premiums paid for maternity insurance under section 80D of the Income Tax Act, 1961.

7. Flexible Policy Terms:

You can choose any amount of a sum insured as per your requirements within the policy terms. Your premium largely depends upon the sum insured you have chosen. Moreover, if you think you might require additional coverage, you can top up the existing plan at any time. Furthermore, if you are not satisfied with the insurer, you can change your insurer without losing the accumulated no-claim bonus and serving the waiting period for the pre-existing diseases.

Should you liquidate your investments or take a personal loan to cover maternity expenses?

Many individuals either do not buy a health insurance policy in advance or overlook the terms related to maternity coverage. This puts them in a challenging financial situation during pregnancy. In such situations, couples generally consider liquidating their existing investments or availing of a personal loan. While it is not advisable to take a personal loan as it is a high-cost loan, you may consider liquidating your investment if it is made specifically for maternity expenses, a medical emergency or related expenses. However, it might not make sense to withdraw investments made for other life goals as it can affect your financial future. Therefore, it is best to buy sufficient health insurance coverage after reading and understanding the fine print of the insurance policy.

However, bear in mind that certain pregnancy complications and expenses are not covered under the insurance plan. Besides, if you go to the best hospitals, the expenses might not get covered within the maternity coverage cap. Such situations can lead you to liquidate the investments made for other goals or opt for a personal loan. Therefore, apart from buying maternity insurance, it is best to prepare yourself financially to take care of the expenses if the need arises.

To Conclude:

Buying a health insurance policy with maternity coverage is advisable for all couples who intend to extend their families within the next few years. Since most insurers offer maternity coverage with a waiting period clause, it becomes mandatory to serve the waiting period until you take the benefit of the insurance. The premiums of health insurance plans can significantly vary from insurer to insurer; hence, it is essential to compare various plans and choose the right one. Also, ensure you thoroughly read the policy's fine print and ensure the benefits you are looking for are included in the list of inclusions. Do not forget that certain pregnancy complications are not covered in maternity insurance. Hence, it is best to be financially well-prepared by engaging in prudent financial planning.

Warm Regards,
Ketki Jadhav
Content Writer