Mother's Day 2023: Here's how your health insurance can financially prepare you for your first child

My wife and I (residents of New Delhi) are planning to have our first child next year. As part of the financial planning, we want to invest in a good health insurance plan that can cover maternity and newborn expenses. How much cover is sufficient for this and how soon should we buy insurance? Lastly, what is the premium range for this policy?

Rashmi, Jaipur

Reply By Siddharth Singhal, Business Head - Health Insurance, Policybazaar.com

Financial planning should always be preceded by family planning and it’s heartening to see more couples being aware of maternity insurance. It is ideal for expecting parents to opt for adequate coverage that accounts for pregnancy, hospitalization as well as new-born expenses. If you are planning a child next year, it’s important to bear the waiting period in mind. Couples often look for policies when they are already expecting. Ideally, a policy should be bought at least 1-2 years before planning a child owing to the waiting period. Fortunately, insurance companies have made this decision easier for customers by bringing down the waiting period from 2-3 years to as low as 9 months which makes it easier to plan a family in the near future. Often, people solely rely on their corporate cover, which can be a mistake.

The estimated cost of pregnancy and childbirth can range from Rs 50,000 to 70,000, especially for C-section deliveries. Since you are a resident of a metro city, the cost can even touch Rs 1 lakh depending upon the hospital and the procedure. With just a corporate plan, you could end up shelling out a significant amount of money from your own pocket to cover these expenses. The good news is you can get it all covered through maternity insurance. In fact, there are new plans available in the market offering coverage of up to Rs 2 lakh to 1 crore, with a particular amount designated for maternity-related expenses. Talking about premium, for a sum assured of Rs 5 lakh, the monthly premium ranges from Rs 700-1,000 approx. 

The premium could also vary depending on the cover amount one opts for. The new-age plans also cover procedures like IVF treatment, should a couple need to opt for it. There are two options available - you can either opt for a standalone maternity insurance policy or you could go for a health insurance policy with a maternity cover. The policy also accounts for ambulance charges, NICU and vaccination charges for the new-born from 30-90 days of the delivery among other costs. Apart from this, like any other health insurance policy, maternity policy also qualifies for tax benefits up to Rs 25,000 under Section 80D of the Income Tax. So, I would advise you to wait no further and be emotionally as well as financially ready to welcome your child.

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