To help you perhaps get a better handle on this, here are my 3 “Need to Know” about Pregnancy Insurance.
1. It covers conditions that are not nice to talk or think about during pregnancy
Here are some examples of the conditions being covered:
I guess I don’t have to elaborate anymore. That is why this type of insurance is always a difficult discussion with an expecting mother.
2. There are many versions
There are at least 5 insurers offering this insurance and they have unique offerings such as cover for IVF pregnancy, twins/triplets pregnancy and stand-alone or bundling options.
There is a saying that “No two pregnancies are the same, even when the parents are.” Ok, I’ll admit that this is my common saying because I had 2 very different experiences with my 2 girls. The point is, if pregnancies are often different experiences, the type of insurance protection should be flexible and considered rather than “one-size-fits-all”.
While having so many versions can make it a daunting task to choose the most appropriate plan, it is actually a really good thing. For example, if you have an IVF pregnancy, you should not be buying a basic plan that does not cover IVF even if the premiums are lower. On the other hand, if you are carrying twins, you would want the coverage to cover both and not one child. Or perhaps, budget is tight and all you want is some basic protection, you should choose one that fits this requirement.
Also, you can bundle the pregnancy insurance with an investment, savings or life insurance plan to start financial planning for the child early. It really depends on what you want and in short, you can save money and have something more appropriate because that is what options can do for you.
3. Your child is guaranteed to be able to buy insurance
What? Does my child need a guarantee to buy insurance? I thought that as long as I have the budget, I can buy insurance?
Because most of us have good health, we take it for granted that we can buy insurance at any time we want as long as we have the money. In reality, it does not work that way. You need both money and good health to buy insurance. In other words, if you have a lot of money but not good health, you can’t buy insurance.
In my opinion, both personal and professional, the most valuable feature of the Pregnancy Insurance is what is known as the “Guaranteed Insurability Option”. This means that you can transfer the insurance you bought to the child after birth without any insurance underwriting or assessment.
This is a complicated option as there are terms around how much you can transfer, what type of coverage to transfer to and when the transfer can be done to enjoy the guaranteed insurability. This should be discussed in detail with the financial planner at the point of purchase.