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Maternity covers may see an increase in premium, with Insurance Regulatory and Development Authority (Irda) advising companies to design comprehensive covers for this purpose.
Insurers said that if the mandates by the regulator are followed and products are launched under those norms, there could a rise in the cost of such covers by 20-25%.
In clarifications issued recently, Irda had said that maternity expenses shall include medical treatment expenses traceable to childbirth (including complicated deliveries and caesarean sections incurred during hospitalization) and expenses towards lawful medical termination of pregnancy during the policy period.
Further, it has been explicitly stated that pre-natal and post natal medical expenses for delivery or termination will generally be excluded from maternity expenses, unless insurers make special provisions for it
Earlier, the lawful medical termination of pregnancy during the policy period was limited to 2 deliveries or terminations or either during the lifetime of the Insured Person. This has now been revised to lawful medical termination of pregnancy during the policy period.
Manasije Mishra, CEO, Max Bupa Health Insurance explained, "For several players, the definition of maternity has to be amended. Premiums may have to be revised, if the cover is made more comprehensive." He added that their policy already covered post natal expenses and further also covered the child, from the moment it is born to the first year. For Platinum policyholders, the child receives coverage for immunization till the age of 12 years.
Industry experts stated that, in general, there are very few retail insurance covers available for maternity benefit. A senior general insurance industry official said that even if such a cover is offered, crucial segments like complications in pregnancy are not covered, since the expenses and risk associated with it is higher. Hence, the official said that due to Irda's re-clarification on maternity expenses, the policies could get more expensive.
In an average maternity cover which is offered under the group platform, insurers said that there is a cap on the number of deliveries that are covered and also on the amount which can range from Rs 30,000-Rs 1 lakh depending on the type of delivery and complications (if any). If such a cap is not existent, such covers would have a higher premium compared to these products.
Further, based on the experience with the particular group, there could be revisions in premium made. Segar Sampathkumar, General Manager at New India Assurance informed that on the basis of a previous experience with a particular corporate/group under the policy, if there is any cost erosion or cost drain, revisions in premiums are made.
Insurers believed that with more players planning to enter the retail market to provide maternity plans, the expenses to provide coverages would also automatically increase.
The senior product development official of a private general insurance company informed that this was due to the fact that due to the complexities involved during child-birth, the liability of companies would be high and the price needed to match with this criteria.
