A version of this article originally appeared on americanfidelity.com.
Welcoming a newborn is often an exciting time that also can be accompanied by uncertainty. That’s true both in normal times and during a pandemic, but the coronavirus has heightened many fears associated with giving birth: changes in hospital admittance processes due to COVID-19, visitor limitations to reduce the risk of infections, and a financial fear of tightened finances due to the unknown.
If you’re considering becoming pregnant in the next few months, one smart step you can take now is to sign up for disability insurance for benefits you can count on. These benefits typically are paid directly to you—rather than to a doctor, hospital or employer—and you can use them to cover a variety of bills when you’re not working.
Income protection insurance that delivers regular monthly payments while you’re out on disability can help you avoid dipping into your savings or taking out a loan in order to cover your necessities. Instead of worrying about your bills, you’ll be able to focus on your new bundle of joy and your own recovery.
Disability insurance as part of your birth plan
Disability insurance, which usually needs to be purchased before you become pregnant, can play an important role in your birth plan.
Disability insurance plans differs by provider and plan type, but the basics are generally the same. If you’re planning to use your disability insurance for maternity leave, there’s some important terminology you need to know to understand your plan and how it works.
Your delivery date is your first day of disability. That starts the clock on your elimination period. This period, starting on the first day of disability (your delivery date), is the number of days before any benefit is payable. A typical elimination period is either 7 or 14 days. Your plan begins paying you after your elimination period is complete.
After your elimination period ends, you’ll enter your benefit period. That’s the time frame in which your benefits are payable. Your doctor will determine your disability/benefit period, based on your situation.
Here’s a hypothetical example: You deliver your baby via caesarian section on Oct. 1, which is your first day of disability. If your plan has a 14-day elimination period, your policy won’t begin paying until Oct. 15, when your elimination period is complete and your benefit period starts.
If your benefit period lasts 8 weeks (minus the 14-day elimination period) because you had a caesarian delivery, you’d begin receiving payments from your policy Oct. 15 and continue getting paid through Nov. 27, when the benefit period ends.
Note that each disability policy varies, and you should review your plan to understand exactly how it works during maternity leave. Confirm your benefits in advance to know what’s covered and to avoid a possible claim denial.
Also, you may be tempted to get your paperwork filed before your big day, but you have to wait. Your delivery must occur before you can file your claim because your actual delivery date starts the clock on your elimination period.
Review your plan for other childbirth benefits
Check your policy in advance to see what benefits may be payable as a result of childbirth. You may also consider reviewing the claim filing forms and filling out some portions before your baby is born so it’s one less thing to worry about after delivery.
Some additional benefits to look for include:
Physician Expense Benefit: This pays a lump sum if you see a doctor due to an injury or sickness. With many disability plans, you can file a benefit for your initial diagnosis visit or when you first saw your obstetrician and confirmed you were pregnant.
Disability Benefit: This pays a lump sum upfront for the number of weeks you will be on disability, minus your elimination period. If a disability is to be extended, an updated form is required, and payments will be made based on the schedule in your policy.
Hospital Confinement Benefit: This pays a daily benefit for each day you stay as a patient in a hospital1 due to a sickness. In this case, that’s your delivery. Refer to your plan to see if this benefit is included.
If you’re unable to work due to disability before your delivery date (e.g., if you’re put on bedrest) or after your routine pregnancy benefit period is over, then you may submit updated physician forms to request additional benefits.
It’s also a good idea to investigate extended coverage in the event that unforeseen pregnancy- and delivery-related complications keep you out of work longer than you had anticipated.
Sweeten your maternity leave
You’ve made a smart decision to include disability insurance as part of your family’s financial plan. After all, the more prepared you can be, the better. As we’ve all discovered, there will be many circumstances we never could have planned for, including a global pandemic.
Maternity leave is intended for healing from the physical effects of childbirth, as well as a time for bonding with your baby and relishing special moments. The little steps you’ve taken to review your income protection benefits now hopefully will help lessen your worry and make the time with your newborn even sweeter.
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1 Hospital: the term “Hospital” shall not include an institution used by you as a place for rehabilitation; a place for rest or for the aged; a nursing or convalescent home; a long-term nursing unit or geriatrics ward; or an extended care facility for the care of convalescent, rehabilitative, or ambulatory patients.
