Pregnancy & Disability Insurance

Welcoming a child into your family is an exciting event.   It is also an expensive one. The long list of needed baby items and expenses really adds up quickly.  This is also likely to be a season of reduced income as one or both parents take time off work without pay after exhausting any paid family leave or vacation days.

A common question is to ask if disability insurance provide relief?

In short, the answer is no.  The exception is that some group short term disability plans will cover pregnancy. That means that you can’t really plan ahead because either your employer offers the right kind of policy or they don’t.    If your employer does offer short term disability make sure to read the terms and conditions. Fine print makes all the difference!

Individual policies that you can purchase on your own don’t cover pregnancy unless there is a complication that results in your inability to work.  If you are able to work but are choosing not to, there’s no income provided.  It’s not maternity-leave insurance after all.  If such a product did exist young women planning to start a family would flock to buy a policy, get pregnant and within 9 months be claiming income and then letting their policies lapse when they no longer plan to have more children.  The rates required to support such frequent claims would be outrageous. For an insurance company to offer a policy they need a large pool of insureds and a small expected number of claims.