One in every four pregnancies has complications that require parents to take additional time off from work, which is why anyone who is pregnant or planning to become pregnant needs disability insurance. If you are unable to return to work immediately after childbirth, a short-term disability insurance plan will pay you for a few months.
It’s critical that your policy covers any complications from childbirth as well, so you have the time you need to get proper treatment and recover. Pregnancy disability insurance can also accelerate dormant illnesses and other conditions, which means a long-term disability insurance policy will be important to have if you need extra time off.
What type of pregnancy disability insurance should you get?
Long-term disability insurance is the best choice because it pays out benefits for months, years, or even decades. Because short-term disability insurance only pays out for a few months to a year — you’ll be out of pocket if your condition lasts longer and prevents you from working. Here’s how the two compare:
Short-term disability insurance
Employers typically provide short-term disability insurance policies, which replace a portion of your paycheck if you are unable to work due to illness or injury for a short period of time, up to one year. The time between being diagnosed with a disability and receiving benefits is frequently only a few weeks. In lieu of a defined maternity leave policy, policies provided by employers may list normal pregnancy as a disability.
Short-term disability insurance policies may cover childbirth if there are complications involved.
Long-term disability insurance
Long-term disability insurance also replaces a portion of your paycheck if you are unable to work, but the benefit period can last years or even until retirement, and the waiting period can range from three months to a full year. Some employers offer plans, but many people buy individual policies from private insurance companies.
Giving birth, whether vaginal or by C-section, does not qualify for a disability insurance claim. Complications during pregnancy, on the other hand, are. C-sections, for example, may necessitate a longer recovery period than maternity leave or a short-term disability plan, and doctor-ordered home leave would qualify you for long-term benefits.
Before covering pregnancy-related conditions, your insurance company may require an elimination period of at least 90 days. Some insurance companies will have a 90-day pregnancy exclusion period even if the exclusion period for other disabilities is shorter.
Maternity leave and disability insurance
Maternity leave and disability insurance operate independently. If you take maternity leave to give birth or care for a child, you will not be eligible for disability benefits unless the birth is complicated or your doctor orders bed rest.
The most common pregnancy complications are C-sections and Perinatal Mood And Anxiety Disorder (PMAD). According to the National Institute of Mental Health, PMAD affects nearly 15% of pregnancies.
Complications during pregnancy and after childbirth can keep you from working for days, weeks, or months, so disability insurance is an important consideration. The FMLA law protects your job when you take maternity leave, but only disability insurance protects your income.
Applying for disability insurance during pregnancy
You can apply for and purchase long-term disability insurance up to the third trimester of your pregnancy, with one major caveat: the policy you purchase will exclude your current pregnancy and any complications that arise from it from coverage. If you apply during the third trimester, the insurance company will most likely put your application on hold until you’ve been back at work for 30 days.
Even if you aren’t pregnant yet, complications from your first pregnancy may be excluded. If you disclose that you are trying to get pregnant or if your medical records reveal that you are (for example, if you are undergoing fertility treatment), the insurance company may only offer you a policy that excludes birth and pregnancy complications. If your first pregnancy ended in a healthy birth with no complications, the policy would most likely cover you during subsequent pregnancies.
If you’ve previously had pregnancy complications, such as preeclampsia or a miscarriage, those complications may be excluded from your policy, even if you’re not currently pregnant.
If you want to be covered in the event of a disability caused by pregnancy complications, you should apply for long-term disability insurance before becoming pregnant. If you are already pregnant, any policy you purchase will not cover pregnancy or birth complications.
Disability insurance features to consider if you’re planning on becoming pregnant
When looking for the best long-term disability insurance policy, there are some general policy features and provisions to consider. These provisions are important for everyone, but they may be especially helpful if you’re purchasing a policy because you’re concerned about complications in future pregnancies.
- Own-occupation: An own-occupation policy states that you will receive benefits if you are unable to perform your regular job. That is, if you are able to work, you will continue to receive disability insurance benefits.
- Non-cancelable: The insurer cannot raise your rates. Because raising policy rates is uncommon, it is usually not something you need to be concerned about, but if your policy does not include this provision, we recommend adding it.
- Residual benefits: If you are able to work but not at the same rate as before — either your hours are reduced or your income is reduced — a residual benefits policy will provide a partial payout.
- Guaranteed renewal: The insurer cannot cancel your policy while you are still paying for it.
It’s also important, if you’re planning to become pregnant, to choose a policy that will protect your financial future.