Things To Know Before Buying An Insurance Cover For The Newborn

Cost of Newborn Care

Did you know that NICU charges can go up to Rs.10,000 per day? You can expect to shell out anywhere between Rs.20,000 to Rs.30,000 in a private hospital daily. Combine this cost with other ancillary charges, hospital accommodation, and treatment costs, and you can run the risk of running out of savings very early on. For your information, the average cost of care for an infant weighing less than 1000 grams can cost up to Rs.2 Lakhs! 

IRDAI on Insurance Coverage for Newborns

Following the concerns raised by the Newborn Medical Insurance Committee of the National Neonatology Forum on the inadequacy of insurance coverage for newborns, the IRDAI has made way for new reforms. It defined to term ‘newborn’ as ‘a child born during the policy term and aged up to 90 days.’ This has made way for specialized insurance schemes for newborns that cover them right from the time they are born.  

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Things To Know Before Buying An Insurance Cover For The Newborn

Now that we have established the importance of an insurance cover for the newborn, let’s delve into some facts that you should be aware of before buying insurance for your infant. 

1. Type of Available Insurance Options

   As of now, there are no insurance plans for the sole protection of newborn babies. If you are looking to buy insurance for your newborn, you can either invest in a family floater policy or a maternity benefit insurance scheme with a newborn care add-on feature. 

   While family floaters offer coverage for newborns after the initial 90 days, maternity-based insurance schemes can be customized to cover a newborn from the first day of birth. 

2. Newborn Care Add-On Features

   • Add-on benefits that offer coverage to newborns from day one of birth can be availed only on the payment of additional premiums. 

   • Coverage may include in-patient hospitalization of the child for illnesses/injuries, and mandatory vaccinations during the policy term. 

   • Newborn care add-ons may cover pre-and post-hospitalization expenses, subject to a percentage of the sum assured under the benefit.

   • Benefits under such add-ons are offered from the time of birth till 90 days of the newborn at any point during the policy term. These are known as ‘just born baby covers’. Note that some insurers offer this cover as a default benefit with postnatal treatment.

   • Some policies offer a lump sum payout (subject to a percentage of the sum insured) on the diagnosis of a newborn with a birth defect.

3. Coverage Amount

   Since insurance covers for newborns are available as extended features of a base policy, healthcare expenses are only covered up to a pre-specified percent of the sum insured. Against the sum insured, crucial coverage points of a good insurance cover for newborns should include pre and post-natal hospitalization, treatment of neonatal complications, delivery of the child, and vaccinations.

   While mandatory vaccinations are covered under such benefits, those that require subsequent shots shall only be covered on renewing the policy with the newborn as an insured. You shall have to pay an additional premium to add your newborn as a member of your family floater health plan. 

4. Premiums Payable

   You should expect to pay an additional premium to enjoy coverage benefits for a newborn within an in-force policy or at the time of renewal. However, there have been instances where insurers have offered in-built newborn protection and maternity benefits at no extra costs. 

   A few insurance companies may allow midterm inclusion of coverage for a newborn at additional pro-rated risk premiums upon being intimated. 

5. Documentation

   On renewal of an insurance policy, you may want to add your newborn to the cover. This requires you to first intimate the insurer and then submit the relevant documents. These primarily include the birth certificate, infant’s medical file indicating any birth defect or medical condition, maternity discharge card, etc. 

6. Waiting Period Clause

   Newborn cover add-ons and maternity benefits also come with a waiting period. Expenses arising out of a newborn baby's care are covered by insurance schemes only after this period. Therefore, if you are planning to have a child, you are advised to buy insurance well in advance to ensure that both pre-and postnatal care is covered by it. 

7. Upgrade Policy After 90 Days of Birth

   Insurance covers for newborns are required to be upgraded to include the newborn as a separate insured member under a family floater on the completion of 90-days post-birth.  If you choose to skip this step, coverage for your newborn may cease. 

8. Co-Payment Clause

   Insurance plans for newborns that come with the co-payment clause require you to share a part of the expenses with the insurer.  You should enquire about the same and the sum that will go out of your pocket. 

9. Eligibility Conditions

   • A parent has to be covered under the base policy to avail of the benefits of a newborn cover.

   • The parent has to be 18 years of age or above.

Summing Up!

In the past, most insurance covers for newborns were limited to vaccination coverage and only covered costs arising out of treatment post 90 days from the date of birth. Furthermore, a newborn baby cover was only available as an extension of family floater plans. Therefore, the amount of coverage failed to meet the growing costs of treating neonatal complications.

Since then, however, several changes have come up in the insurance space for newborns that are specifically targeted towards tailor-made solutions for their care. The above pointers should help you pick the most suitable insurance cover for your newborn.