Children’s charity criticises lack of insurance cover from birth

The founder of a leading charity working with sick children has challenged the Irish insurance industry to explain why it will not offer specified-illness cover and life cover to children from birth.

Jack and Jill Foundation chief executive Jonathan Irwin said the practice not to offer cover from birth by all insurance companies except Irish Life was unfair on parents of seriously ill children.

"I feel compelled to question this unfair but widespread practice on behalf of the 2,100 children, from birth to four years old, with life-limiting and life-threatening conditions as a result of brain damage, including those we've supported with end-of-life care," he told The Irish Times.

“As a result of this practice, the families of these precious children are excluded from obtaining any benefits from either their life cover or child serious illness benefit.”

Only Irish Life offers cover

Only one insurance company offers specified-illness cover or life cover for children from birth under family or parent plans. In July, Irish Life introduced child specified-illness cover commencing at birth with certain conditions attached.

Apart from Irish Life, every other company offers child and specified- or critical-illness cover from, at the earliest, 30 days and in some cases doesn’t start until the baby is six months old.

This means any child born with, or diagnosed with, a life-limiting condition within 30 days of birth, is excluded from any critical illness benefit or life cover.

Irwin says that if the rationale behind the practice was a cost-saving exercise, it was extremely harsh and unfair on families struggling with the stress of caring for a sick child.

He says that a high proportion of children with life-limiting and life-threatening conditions die in the first year of life with many dying within the first month. Their parents are too exhausted and traumatised by their child’s diagnosis and round-the-clock care to kick up a fuss about the insurance policy debacle, he says.

“These parents have enough to cope with in dealing with the diagnosis and implications of sleepless nights and around-the-clock care plans and bringing their child home, for whatever short time they have.

“And then to see insurance companies putting in a caveat to exclude them from automatic cover until the child is a month old or six months old or a year old just does not sit well.”

‘Cruel’

Irwin says there is already too much bureaucracy around the Irish home-care model with parents having to form fill and fight for every little support for their child.

“Then to see the insurance companies leaving such children out in the cold until they reach six months – well that’s just cruel and must be exposed, questioned and rectified.”

Irish Life’s decision in July to provides specified-illness cover from birth now marks it out from the other main players in the Irish insurance market.

Irish Life had previously offered free child specified-illness cover from 30 days until the child turned 21 but with the new enhancement, Irish Life now covers children from birth until 25.

Martin Duffy, head of underwriting and protection claims at Irish Life, said: "Specified illness cover now runs from birth provided the parents weren't aware of any problems during the pregnancy and took out the cover during the pregnancy to cover that eventuality.

“Typically, what would happen is the woman, on becoming pregnant, would go for a scan and they might pick up some issue on the scan and, if they took a policy at that point, they would be excluded. But if the policy was in place for several years prior to that, then the child would now be covered from birth – they would only be excluded if they started the policy on learning of some condition.

“It covers the same insured conditions as for parents but with two exceptions: brain injury due to anoxia or hypoxia and intensive care requiring mechanical ventilation, which are excluded.

Practical costs

“Cover in those two cases starts at 90 days but in all other cases, a child is covered from birth and is covered for half the parent’s amount of specified illness cover up to a maximum of €25,000.”

Duffy says that, between 2006 and 2015, Irish Life has paid out 219 child specified-illness claims with a total of €4,064,192 while last year it paid out €382,587 on 19 specified-illness claims.

“About half of those claims are for cancers and when I am talking to advisers, I say to them that no amount of money is going to help the child diagnosed with a cancer in those sorts of situations. But what it does do is that it helps parents take some time off work and that’s a key thing in terms of the benefit and it also helps with some of the ancillary costs associated with having a sick child.

“So it can help, for example, with the cost of travel to and from hospital, the cost of staying in Dublin if they are living down the country, even something as simple as the cost of hospital parking.”

Irish Life also offers life cover from birth provided the policy was in place before the woman became pregnant and in July it upped the cover from €6,000 to €7,000 and extended it from 21 to 25 years.

If the life cover is in place for less than six months before the child’s birth, then the child is only covered for accidental death from birth and cover from illness only begins at six months, says Duffy.