Maternity covers offered by corporates are not in alignment with the rising cost of maternity in urban cities in India, according to a report by employee health insurance platform Plum. 

As per the report titled  ‘Is maternity under-insured in India?’, the average cost of child-birth (vaginal births) in tier 1 cities and metros in India at private hospitals ranges between Rs 45,000 – Rs 55,000. On the other hand, the cost of C-sections in private hospitals can range between Rs 70,000 and Rs 2,00,000, depending on the level of complications. 

However, while 66% of Plum’s customers have adopted maternity covers, a majority of them cover expenses up to Rs 50,000 for up to 2 children. Only 15% of Plum’s customers, which are new-age companies, have taken covers between Rs 1,00,000 and Rs. 1,25,000 for maternity. These companies include Twilio, Mintmesh, Evenflow, Vonage, and Ironsides among others, the report said. 

The report said that maternity is an optional benefit and many organizations do not opt for it due to employee demographics and cost. 

Standalone retail policies for maternity are non-existent in India. Additionally in retail health insurance, there is a 90-day waiting period from the time of the child-birth of the baby to get medical insurance coverage. 

Group Health Insurance (GHI) policies can cover female employees and female spouses for expenses on maternity treatment, infertility, and any prenatal complications and offer a baby day cover from day 1. 

According to the report, ideal maternity benefits should provide a minimum coverage up to Rs. 1,00,000 for tier1 cities and should have baby day covers from the very first day. 

Commenting on the report, Abhishek Poddar, CEO, and Co-founder of Plum said, “Companies today are in a position to do much better for their employees. This is not about insurance alone, this is an opportunity for us to kindle conversations around workplace equity, social justice, and forward-thinking. When it comes to education, women in our country are doing better than men (i.e, growing at a faster rate), but as a culture, we seem to be making it harder for them to return to work after giving birth. Companies have a responsibility towards this end, first by having clear-cut policies and then implementing them with passion and without prejudice.”

“The inclusion of a comprehensive maternity cover in Group Health Insurance comes with multiple advantages. Besides the shorter waiting period and baby cover from day 1, it goes a long way in making the workplace more equitable for women and providing them with a sense of financial security,” he added.

According to the report, healthcare inflation in India is rising at 18-20% annually. With this backdrop, lack of proper maternity benefits could be one of the key reasons for a drop in the percentage of the women workforce from 26% in 2005 to 20.3% in 2019.