Most employers do not provide paid maternity leave benefits. These benefits are simply too costly for most small and medium sized businesses. Five states mandate disability coverage that creates a limited amount of maternity income, as coverage is capped at a fairly low amount. And the female workers in forty five other states have no coverage at all. Supplemental maternity insurance is a great way to solve this problem. When bought preconception, these policies help create maternity leave income, and allow for protection in case of complications, and premature birth.
Paid maternity leave is a common benefit in many European countries. In the United States, this type of benefit is the exception rather than the rule. A small percentage of employers provide a direct maternity leave benefit for their female workers, while others provide some type of company paid short term disability policy that provides maternity leave coverage. Another percentage offer disability programs that the employees can elect to pay for themselves.
Five states mandate short term disability insurance coverage for people who work in the state: Hawaii, California, New Jersey, New York, and Rhode Island. While great to have, these programs may replace only a small percentage of income, or they cap out at a very small amount. For example, New York state replaces only 50% of income, and caps out at $170 per week. Being one of the states with the highest cost of living, and thereby the highest average income level, $170 per week is a very small amount of income replacement.
While any level of income replacement is nice to have, forty five states have no mandated coverage at all. Women working in these states face a bigger dilemma: their employer may not offer paid maternity leave policy, and/or no group disability benefits at all. Adding a new mouth to feed and raising a child is expensive enough without starting off with six to eight week of unpaid leave. And what if mom needs to leave work early due to complications, or what if her baby is born premature and requires care at home for an extended period of time?
Supplemental maternity insurance is a great way to plug these holes. Supplemental maternity insurance pays cash benefits directly to the insured for mom's normal labor and delivery, helping to create maternity leave income. Mom's benefit for normal delivery may greatly exceed the premium she pays. Also, 25% of pregnancies result in one or more complications. Supplemental maternity insurance will replace her income should she need to leave work prior to her delivery.
In addition, 12% of babies are born premature and may need to spend time in the neonatal intensive care unit (NICU). Many insurance policies now contain daily co-pays ranging up to $300 to $500 per day. An extended stay in a NICU can leave new parents with a sizable and unexpected hospital bill. Supplemental maternity insurance will pay additional benefits should this occur, helping to offset these left over expenses.
Supplemental maternity insurance is a great option to consider before getting pregnant.
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