Pregnancy is often referred to as one of the most joyous times in a person’s life – for the mother due to the joys of carrying a child and for the father the opportunity to watch a new life come into the world.
When it comes to pregnancy and an occupation, there is usually a time right before the birth of the child and a few weeks after in which the mother does not work and instead stays home to care for and bond with the child.
During this time, not many people think about their income protection insurance and whether or not it will cover them during the weeks after the baby has been born.
Income protection insurance is meant to compensate in part for a loss of earnings that may be experienced by the policy holder as a means to support themselves and their dependents.
Generally, these policies help to cover loss earnings that occur due to an unforeseen event, such as an accident, injury, or sudden illness that would leave the policy holder unable to work.
When it comes to income protection policies and pregnancy, it is obvious to see pregnancy is not an “unforeseen event” in which income protection would kick in to help pay expenses due to not being able to work.
As we all should know, pregnancy is most commonly planned in advance and is more predictable than falling off a ladder or being diagnosed with a debilitating illness.
Because of this, many income protection policies will have a list of exceptions for what will not qualify a policy holder to make a successful claim – common headings like “child birth” or “pregnancy” can be found in the exceptions section to indicate that claims cannot be made on such events.
These headings usually can be found with other common headings like pre-existing conditions, self-inflicted injuries, and alcohol abuse.
Why Maternity Leave is Excluded from Income Protection Policies
Although the verbiage of “child birth” and “pregnancy” are included in the exclusions of most policies, there is an argument pregnancy is the time leading up to the birth of the child and child birth is the act of giving birth to the child.
With that being said, since “maternity leave” is the time that comes after the child is born, many people make the argument it could potentially be covered under an income protection policy.
Unfortunately, even though this may be true, child birth, pregnancy, and maternity leave are all viewed as the same thing in the eyes of the insurance company and are excluded.
Maternity leave in many ways is recognized as different from child birth or pregnancy as it is the time after the child is born that it needs to be cared for. Even with that being said, maternity leave does not mean a policy holder is unable to work or should be considered incapacitated.
This is because the mother is still physically and mentally able to return to work and she has simply temporarily relinquished her occupation during this specific period of time. In summary, there is nothing about pregnancy, child birth, or maternity leave that prevents a policy holder from returning to work.
With this in mind, it is easy to understand any income protection policy the policy holder may have will simply be put on a temporary hold or suspended while they are on maternity leave. The policy holder at this time is recognized as still being able to contribute to the family and the usual means of employment after the maternity leave period has ended so she does not need the financial assistance that an income protection policy would provide.
Policy holders should not expect to have a claim honored or have their income protection policy pay them benefits during maternity leave.
The income protection industry is very specific about what it will and will not qualify as a claim worthy event. In almost all income protection policy terms and conditions, the exclusions are clearly outlined and almost 100 percent of the time pregnancy, child birth, and maternity leave are all excluded from being protected under the policy.
Since this is not a reliable source of income during maternity leave, it is important for expectant parents to financially plan ahead if the primary breadwinner will be not be working for a period of time. Some employers do offer paid maternity leave, so it is important to check with the human resources department at a given company to find out more details.