Supplemental Policies with Benefits for Maternity
Frequently Asked Questions
What is the benefit? What are the premiums?
The benefit for these policies can vary greatly depending on how many of the policies you buy. It is not uncommon for the entire cost of a baby's birth to be covered by purchasing these policies.
What exactly are these policies?
These are supplemental hospital indemnity and disability plans.
How is this possible?
These “Hospital Indemnity Plans" are designed to pay the insured a pre-determined benefit amount when they are admitted to a hospital for at least 24 hours. Also, some policies pays the insured a benefit for each 24 hour period the insured spends in a hospital. Although these policies are not technically “maternity insurance”, the delivery of a child atleast 10 months after the policy effective date (and a hospital stay for at least 24 hours) allows a mother to receive benefits. The disability policy(s) pay a predetermined disability benefit for having a child (typically 6 weeks of benefits minus a 7 day waiting period). This benefit is based on income.
Who can qualify for these policies and their benefits?
Depending on your health insurance company and work status, you will qualify for all or some of these plans. Please contact us to find out about your specific situation.
Who can benefit from these policies?
Anyone that is not on Medicaid. Those people who have a separate $5,000 deductible for maternity on their individual health insurance plans can benefit most. If you are expecting a child between 10 months and 26 months from now, it makes sense to purchase as many of the polices as you can. It takes approximately 30 months of paying premiums to outweigh the benefits of the policies. These policies will be extremely attractive to you if you have a $5,000 deductible for maternity. These policies are also very attractive if you have group maternity coverage, but would like a way to help pay for miscellaneous expenses (cribs, clothes etc…). Also, remember that if you are currently on Medicaid, your benefits will be paid directly to the Medicaid program.
How are the benefits paid?
The benefits are paid in the form of a check to the insured. These policies pay you cash regardless of other insurance policies you may have, unless you are on Medicaid. If you are on Medicaid, some or all of the benefits may be paid to the state of Utah.
Can I sign up for more than one policy?
As long as you meet the requirements for each policy, you may purchase multiple policies at the same time. This allows you to receive an ample benefit for having your child.
Is it possible to come out ahead on a delivery with these plans?
Yes. If an insured has coverage through thier employer, or even if they don't, the benefits may exceed the out of pocket expense that the insured is responsible for. This is a common situation.
Can I purchase these policies if I already have maternity coverage through my work?
Yes. In fact, if your maternity is covered in part or in full by your employer’s health insurance plan, you may come out ahead. In some cases, families pay $100 to have their child. This is due to the fact that their group health insurance plan has excellent maternity coverage. According to the example above, if your delivery only costs $100, you would come out thousands of dollars ahead. All but one of these policies pay regardless of other insurance. Contact us to find out which ones will work for you.
How do the insurance companies make money from policies like these?
The fact is that you will most likely pay the insurance company less (potentially a lot less) than you receive in the end. These policies are sold across the United States as accident and sickness policies. In other words, most people purchase these policies to receive benefits in the case that they are admitted to a hospital for sickness or injury. Most people don’t make large claims on their policies, but in Utah, there are many claims made for maternity. As for now, overall, the insurance companies are coming out ahead.
Is there a waiting period before I can make the claim on my policy?
Yes. Most of these polcies must be in effect for 10 months before the child is born. You cannot be pregnant when you sign up for these policies.
What if the baby is born premature?
If the baby is born before 10 month waiting period is up, the insured will not receive any benefits. Most people wait 2-4 months before getting pregnant. The longer you wait, the less you should worry.
What if I am admitted to a hospital for another reason before the baby is born?
If you are admitted to a hospital for a covered accident, injury, or sickness before your child is born, you will be entitled to similar benefits. However, the majority of the benefits are only paid out once per year, per insured. So, if you are admitted to a hospital twice in the same year (once for an accident/sickness and once for a delivery) you should not expect to receive the total benefit twice. Although the second time you are admitted, you will receive a smaller benefit. The benefits reset every calendar year. So, if you are planning on having multiple children consecutively, it will be a good idea to hold onto these policies for a few years.
Do these policies help pay for pre-natal office visits?
Not exactly. Although you may receive a very small benefit for a few office visits, the check that comes after the baby is born will be your way of “reimbursing” yourself for the office visits (along with the delivery).
When does the coverage become effective?
The coverage usually becomes effective on the day the insurance company receives the application from your agent. It will be 2-4 weeks before you know for sure that your applications have been approved and what your exact effective date is.
Can I cancel the policy at any time?
Yes.
