Income protection and pregnancy

Does Income Protection payout if you get pregnant

No, your income protection policy won't payout if you're on pregnancy leave. However, some policies may offer protection for specific complications, including post-natal depression, which prevents you from returning to work. There are also income protection policies available which allow you to pause your premium payments during maternity leave. This is known as a pregnancy premium waiver.

Will Income Protection pay out for pregnancy complications?

It is possible to get cover for pregnancy complications through your income protection policy. In 2010, CommInsure removed post-natal depression from its list of full exclusions, meaning cover is available for this condition which affects 16% of women.

You can also receive a benefit before the end of pregnancy or childbirth for a pregnancy-related condition. Such conditions include:

Be sure to read your PDS thoroughly as many income protection policies will not cover you for pregnancy complications.

Other life insurance products for pregnancy complications

If you can't find adequate cover for pregnancy with an income protection policy, you can often get protection for specific complications as an optional benefit in trauma cover. Benefits covered generally include:

• Complications of pregnancy including ectopic pregnancy, eclampsia or disseminated intravascular coagulation.
• Congenital Abnormalities which can help out financially if your child is born with an abnormality such as blindness, deafness or Down syndrome.
• Death benefit if the child dies during or shortly after birth, or is stillborn at least 20 weeks into the pregnancy.

Keep in mind that waiting periods apply, usually around 12 months, and cover is limited to certain ages. Always read the product disclosure statement (PDS) as well to see exactly what is covered.

Which providers have pregnancy-related features in place?

Do you need to keep paying your premiums during pregnancy?

Some insurance companies now offer a pregnancy premium waiver benefit to their income protection policies to help tailor this type of cover to suit women. This feature acknowledges that the birth of a child is accompanied by significant financial pressures and allows you to opt out of paying your premiums for a specific period of time.

The waiver ensures that your cover will remain in place while you're off work during your pregnancy, eliminating the hassle of re-applying for cover when you return to the workforce. It also guarantees continuity of cover, as most life insurance providers will pay your premiums for a period of up to six months. Even if you're on maternity leave, you have the peace of mind knowing that full cover is still in place.

In order to be eligible for the pregnancy premium waiver:

• You must not be currently working;
• You must be in the second trimester; or
• No more than six months can have elapsed since you gave birth.

If you elect to take maternity leave and have selected the pregnancy premium waiver with your income protection policy, you can get up to 6 months cover. It won't pay you for being off work due to anything pregnancy-related in that time, but it can pay you if something happens and you are off work due to an accident or illness. For instance, if you injure your back whilst at home at the end of your 6 month on maternity leave, your income protection insurance should still cover you.

Pregnancy exclusions - be clear on your options

There are some pregnancy exclusions on income protection policies that you will need to be aware of. Generally speaking, policies do not cover uncomplicated pregnancies or childbirths, if you don't meet a waiting period of more than three months. The reasoning behind this is that there are other types of insurance or even employment perks to cover you in this situation. If a pregnancy causes a disablement, you'll need to pass your waiting period (usually three months) before cover kicks in.

Of course, some income protection policies will exclude any claims arising from pregnancy, giving birth, miscarrying or having a pregnancy termination altogether, so make sure you know exactly what your chosen policy does and does not cover.

Frequently asked questions

• Can I pause my income protection premiums during maternity leave?

  Many insurers offer a pregnancy premium waiver benefit. This allows you to temporarily stop paying your premiums for a period typically up to six months while on maternity leave. Your policy generally remains in force for illness or injury unrelated to your pregnancy or childbirth providing continued protection without the financial burden of premiums.

• When should I consider income protection if I am planning a family?

  It is generally recommended to arrange income protection well before you plan to conceive. Income protection policies will not cover an existing pregnancy. Having cover in place beforehand ensures you are protected for eligible complications and that any waiting periods have passed when you might need to make a claim.

• What is the difference between income protection and trauma cover for pregnancy related issues?

  Income protection typically pays a regular benefit if you are unable to work due to a pregnancy complication causing disablement. Trauma cover, also known as critical illness cover, usually provides a one off lump sum payment upon diagnosis of a specified severe pregnancy complication or if your child is born with certain congenital abnormalities listed in the policy. Each type of cover serves different financial needs.

• Are there waiting periods for income protection claims related to pregnancy complications?

  Yes, waiting periods usually apply. For disablement caused by a pregnancy complication your policy's waiting period, often three months, must be met before benefits commence. For trauma cover, which can include specific pregnancy complications, a waiting period of around 12 months is common from the policy's start date. Always refer to your Product Disclosure Statement for specific details.

• If I have a pregnancy premium waiver will I still be covered for accidents or illnesses during maternity leave?

  Yes. The pregnancy premium waiver keeps your policy active even when you are not paying premiums. This means if you suffer an illness or injury unrelated to your pregnancy or childbirth during your maternity leave that prevents you from working, your income protection policy should still pay out a benefit, provided you meet the policy's terms and conditions.

To make sure you get accurate and helpful information, this guide has been edited by Tim Bennett as part of our fact-checking process.

Written by

Gary Ross Hunter

Journalist

Gary Ross Hunter has over 6 years of expertise writing about insurance, including life, health, home, and car insurance. Having reviewed hundreds of product disclosure statements and published over 800 articles, he loves simplifying complex insurance topics for everyday readers. Gary has contributed to major outlets like Yahoo Finance, The Sydney Morning Herald, and news.com.au, and holds a Bachelor of Arts (Honours) in English Literature from the University of Glasgow, along with a Tier 2 General Advice certification, ensuring his work adheres to ASIC’s RG146 standards. See full bio

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