Take Maternity Coverage with Low Waiting Period

[Apollo Munich CEO]

While buying health insurance, the policyholder mainly compares the
features available under various products and premium payable for each
one of them. In the past few months one distinct feature that has come
to fore is the maternity coverage. Although all insurers under their
retail product lines do not provide this, it is being provided by all
three standalone health insurers, Star Health and Allied insurance
company (Star Wedding Gift Insurance Policy), Apollo Munich Health
Insurance Company (Easy Health Family Floater Exclusive and Platinum
Plan) and Max Bupa Health Insurance Company (Heartbeat Family Floater
Plan).

An FCRB analysis reveals whether taking a health insurance policy to
get coverage for maternity expenses is practical or not. As it turns
out it is beneficial if the waiting period is low and the extra
premium paid by the policyholder is not too high.

FCRB found out the estimated child delivery expenses of few hospitals
in Delhi and compared them with the actual premium being charged by
these insurers.

The charges in economy accommodation for a normal delivery at DR
Maternity and Nursing Home in north-west Delhi are around Rs 18,000 to
Rs 22,000 while the charges go up to Rs 25,000 to Rs 30,000 for the
caesarean delivery. Sri Balaji Action Medical Institute in west Delhi,
charges about Rs 17,000 to Rs 20,000 for normal and Rs 24,000 to Rs
27,000 for caesarean. BL Kapur Memorial Hospital in central Delhi,
charges around Rs 20,000 to 22,000 for normal and Rs 35,000 to Rs
37,000 for caesarean. Holy Family Hospital in South Delhi, charges
around Rs 12,000 to Rs 14,000 for normal and Rs 24,000 to Rs 28,000
for caesarean. In these charges, the expense for medicine, room
charges, doctor’s fees, dietician and pediatrician’s fees, medical
investigation charges, operation theatre charges and nursing expenses
are included.

In order to get coverage for maternity and delivery charges, one has
to opt for family health insurance policy and wait for a few years
before becoming eligible to claim the same from the insurance company.

Apollo Munich has the longest waiting period of four years, while in
Star Health it is three years. In case of Max Bupa the waiting period
is two years.

The analysis shows that the average premium for a couple of around 27
years of age, the premium for a plain vanilla family health insurance
policy with Rs 3,00,000 sum insured comes to Rs 4,700. While the
premium comes to Rs 6,167, Rs 7,354 and Rs 11,366 from Apollo Munich,
Max Bupa and Star Health respectively for their family health plans
with maternity coverage. “The extra premium being charged by insurers
to cover maternity is reasonable and is based on actuarial
calculations for bearing extra cost of maternity,” said SK Sethi, vice-
president of Insurance Foundation of India.

Also, premium for 32-year-old couple, the premium for Max Bupa policy
increases to Rs 7,910 while it remains same for other health insurers.

Under the family health insurance policy with sum insured of Rs
3,00,000 the policyholder is allowed to claim upto Rs 30,000 for
normal as well as caesarean delivery from Max Bupa, Rs 15,000 for
normal and Rs 20,000 for caesarean delivery from both Apollo Munich
and Star Health.

Supposing the policyholder has to avail the maternity cover after two
years and is insured under Max Bupa, then in that case the extra
premium (as compared to a normal health insurance policy) that he has
already paid for the cover is Rs 5,308. If the same benefit is availed
after four years, then the extra premium paid for Apollo Munich is Rs
5,868, Rs 10,616 for Max Bupa and Rs 26,664 for Star Health. After six
years of policy period, the excess premium comes to Rs 8,802 for
Apollo Munich, Rs 15,924 for Max Bupa and Rs 39,996 for Star Health.
The difference comes to Rs 11,736 for Apollo Munich; Rs 21,232 for Max
Bupa and Rs 53,328 for Star Health after eight years of holding the
policy.

This clearly shows that Apollo Munich which charges around Rs 1,500 of
extra premium on yearly basis, is value for money in long run, however
the waiting period is high and coverage for maternity is low.

The extra premium charged by Star Health is highest, the waiting
period is also high and coverage for maternity is low.