Can we combine three insurance policies to claim maternity expenses? | Mint

Can I buy an additional insurance policy only for maternity? We are planning a family and have not conceived yet. My employer covers maternity up to ₹50,000. My spouse’s employer also provides maternity coverage up to ₹75,000. Our total expected maternity costs are about ₹2 lakh. What is the best way to get this coverage? Can I claim it across all three plans? I don’t have any other personal plan.

– Name withheld on request

There are no insurance plans only for maternity. However, you can get maternity coverage as a part of regular health insurance policy. The waiting period for maternity coverage varies from nine months to three years. You should choose a plan that matches your time horizon. Do note that some plans with a nine-month waiting period ask for upfront payment for three years of premiums.

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It is possible to split the claim across three different insurers. Once you make a claim with an insurer, you can submit the settlement voucher of that insurer to the next one. This will help the next insurer ascertain your unclaimed amount and process the balance.

I strongly recommend that you buy and maintain a personal plan in addition to your corporate health coverage. As your family grows, there may be health exigencies that may require additional coverage beyond the limit provided by your employer. Buying personal coverage early also helps ensure that the waiting period is over before you develop a health issue.

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I am 65 years old and I am considering buying an immediate annuity. I am not looking to grow the corpus. How does annuity work vis-à-vis a fixed deposit?

– Name withheld on request

In an annuity plan, the insurer is principally underwriting the long-term interest-rate risk. While a fixed deposit is for the short to medium term, annuities are long-term products. In the case of a bank fixed deposit, the term must be fixed at the time of issuance and the interest rates change based on the term of the deposit. In case of an annuity, the payout can be pre-determined up to the insured person’s death rather than a fixed time period. An individual’s lifespan is unpredictable, and an annuity helps remove uncertainty around regular income for that period.

Do note there are several different payout options with an annuity. You can choose an annuity in which the principal is returned after the insured person’s death or one without such a return, which will deliver a higher annuity amount. Which one you choose will depend on your overall financial plans and dependent’s needs.

As for taxation, the interest earned from fixed deposits is taxable, while the entire income is taxable in the case of annuities.

Abhishek Bondia is a principal officer and managing director at SecureNow Insurance Broker Pvt. Ltd.