Maternity coverage: Buy early, cross waiting period before need arises

With waiting periods and sub-limits, experts advise early planning and careful policy checks to manage delivery expenses

Maternity-related hospitalisation costs have increased significantly, especially in metro cities. One way to manage these expenses is by purchasing maternity coverage under a health insurance policy. Policybazaar.com has recorded a 150 per cent year-on-year increase in the purchase of maternity covers on its platform.

 

High treatment costs 

Maternity-related expenses can be substantial. “In a private hospital in a metro, a normal delivery would cost around 50,000 to 1.5 lakh. A C-section would cost 1.2 lakh to 2.5 lakh, depending on the hospital room chosen, duration of stay, and complications,” says Bhabatosh Mishra, director and chief operating officer, Niva Bupa Health Insurance. If complications arise or if the newborn requires admission into the neonatal intensive care unit (NICU), the bill could rise sharply.

 

Main policy and add-on 

Maternity benefits may be included within the main health insurance policy or could be offered as an add-on that can be added at the time of purchase or renewal. “The rider option allows flexibility: those not planning a family can avoid the extra premium, while those planning one can enhance their coverage,” says Vineet Gupta, head, product development, ManipalCigna Health Insurance.

 

What is covered 

Maternity cover includes expenses for normal or C-section deliveries, generally up to two deliveries, along with pre- and post-hospitalisation benefits. Room rent, ICU, surgeon and anaesthetist fees, operation theatre charges, medicines, and routine delivery-related tests are covered. Newborns are typically covered from day one. Some plans extend the newborn’s coverage for 30 to 90 days, or for the full policy term. First-year vaccinations may be covered if the child is added to the base policy at the time of renewal.

 

Coverage comes after waiting period 

Most plans in India impose a waiting period of three months to three years. “Employer-provided group insurance policies may provide maternity benefits without any waiting period,” says Amitabh Jain, chief operating officer, Star Health and Allied Insurance.

 

Can this cover be removed? 

If maternity cover is built into the base plan, it generally cannot be dropped. “The entire policy would need to be replaced or modified according to the insurer’s product rules,” says Gupta.

 

“Porting is possible but comes with new underwriting based on age and health, possibly increasing costs,” says Indraneel Chatterjee, co-founder, RenewBuy.

 

If purchased as an add-on, it can be removed at the time of renewal. “Customers can place a request for removal through any of the insurance company’s servicing channels. The premium will be recalculated for the upcoming policy year,” says Jain.

 

Who should opt for it? 

Couples in their late twenties to early forties who plan to have a child in the next one to three years may benefit from maternity cover. “It is especially useful for families that prefer private hospitals, higher room categories, structured pre-natal care, and strong coverage for the newborn,” says Jain.

 

Watch out for limitations, downsides

Read the policy fine print, as exclusions can be extensive. Chatterjee points out that pre-existing pregnancy at the time of purchase is completely excluded.

 

Customers wrongly assume the full sum insured is available. “Most plans impose sub-limits for delivery,” adds Chatterjee.

 

Premiums can be high relative to the benefits paid. “The maternity sum insured is usually limited, but premiums are significantly higher. Long waiting periods reduce immediate usability, while strict sub-limits often result in out-of-pocket expenses,” says Shilpa Arora, co-founder and chief operating officer, Insurance Samadhan.

 

Arora points out that some insurers impose a 10-30 per cent co-pay on maternity claims. She adds that newborn coverage may not extend to congenital defects. Most policies allow only one or two maternity events.

 

Key checks to run 

Check the waiting period before this cover commences. Jain points out that some products specify an interval between two deliveries.

 

Mishra advises ensuring the maternity sum insured is adequate. He recommends a sum insured of 3 lakh to 5 lakh. “This will ensure that the delivery is comfortably covered and there is some buffer for pre- and post-natal tests and minor complications,” he says.

 

“Assess newborn protection, including duration of cover and vaccinations,” says Jain. Also, check the coverage available for neonatal complications, NICU care, and congenital defects.

 

Review room eligibility as it has a major impact on final billing. “Choose a policy without room rent limits,” says Siddharth Singhal, head of health insurance, PolicyBazaar.

 

Ensure that your preferred hospitals are part of the insurer’s network so that cashless facility is available. “Review whether the plan offers reinstatement or refill of sum insured after the maternity claim, so that future non-maternity hospitalisations are still covered,” says Mishra.

 

Do’s and don’ts 

Gupta cautions that customers must maintain continuous coverage for 24 to 36 months before claiming maternity benefits. “The biggest risk is couples buying too late due to lack of awareness, resulting in denied claims,” says Chatterjee.

 

Mishra recommends that once a customer no longer needs maternity benefits, they should consider removing the rider at the time of renewal to optimise premium versus benefit.

 

Exclusions to watch out for

• Pregnancy-related complications, emergency procedures may be excluded
• Reimbursements for complications could be capped
• Newborn cover could be limited to the first 90 days
• Sub-limits on newborn coverage could be insufficient for NICU care
• Treatments for congenital anomalies could be excluded
• Infertility treatments are excluded