A lot of people talk about egg freezing as a form of insurance: we make a major near-term sacrifice to help protect us from a potential future catastrophe. But not all forms of insurance are an equally good deal, and here we compare using egg freezing as an insurance policy, and buying an auto insurance policy.
Upfront Payments & Annual Premiums
Egg Freezing = $18,000
Egg freezing costs are made up of three major payments: the drug fees, the doctor’s fees, and the annual storage fees. For our purposes, let’s suppose you are a 30-year-old woman, living in San Francisco* who does a single egg freezing cycle, collects 10 eggs, and pays annual storage fees for 10 years. Let’s call these your “premiums” and they total around $18,000 by year 10.
Auto Insurance = $9,100
Similarly, let’s suppose you are the same 30-year-old woman living in San Francisco, and according to Progressive, your annual auto-insurance costs are $910, or $9,100 for that same 10-year horizon.*
*If you work for Google, you probably don’t pay for egg freezing, and you ride the free bus, so feel free to go back to looking at job postings at Facebook.
Likelihood of “Making A Claim”
Egg Freezing = 10 – 20%
By our estimates, 10 – 20% of women who freeze their eggs return to use them. That range can vary a lot depending on several personal factors, like the age at which you banked your eggs, or whether you have a medical condition that requires you to do IVF.
Auto Insurance = 90%
In contrast, American drivers make an auto-insurance claim every 17.9 years. So there’s around a 50% chance over the course of that 10-year auto policy that someone will dent your Ferrari and you’ll need to make a claim.
Value of The Policy
Now let’s imagine our egg freezer has the foreseeable “accident” — she wants to have a baby and it’s not happening.
Will those eggs she froze work? Well, that may depend on the age at which she banked, and the number of eggs she collected, amongst other factors. Remember, you banked your eggs at age 30 and collected 10. According to one dataset, 60% of egg freezers with a similar profile had a live-birth.
So what is a policy worth if, in the 15% chance you need it, it stands a 60% chance of saving you from catastrophe? That is a function of the size of that catastrophe. In this example, the catastrophe means relying on IVF to have a child, with the associated costs ($23,000 per cycle depending on your city) and risks that it doesn’t work at that time (3.7% of cycles result in success for women 42 and older). Some women are great candidates to have IVF work for them, and have plenty of money, and many do not.
If you want to quantify what this policy might be worth in a purely financial sense, let’s presume you need this policy at age 40, and with each IVF cycle you have a 25% chance of success. Let’s presume after four cycles, and roughly $100,000, you have your baby. Thus your plan is worth 15% (likelihood of claim) x 60% (likelihood of payout) x $100,000 (the purely financial cost of catastrophe). That adds up to $9,000, and you spent $18,000 in premiums.
However, maybe you are a 25-year-old woman who has a partner with male factor infertility. You are 80% sure you will need to do IVF, and since you are young with good eggs, there is a 90% chance those eggs will work when called upon. In this circumstance, your policy is worth $72,000, well in excess of the premium cost.
Now let’s imagine our auto-insured driver stands a 50% chance of getting into an accident, and if she does not have insurance, is facing, on average, a $23,000 bill. But if she is covered, the data says auto-insurance will eventually cover about 60% of the bill.
So for the 50% of drivers who place a claim, they likely save about $13,800 (60% of $23,000). By the same logic, the value of that auto insurance policy is around $6,900, and when compared with the cost of premiums, is a money loser.
Clinicians often take umbrage with the notion that “egg freezing is a form of insurance”. However, that all depends upon your perception of insurance. Just as with auto insurance, there is no promise you will ever need it, and maybe more surprisingly, no guarantee it will pay out when you do. And of course, none of this is to say egg freezers should take such a quantitative approach to the choice. The reality is many patients think about egg freezing as a way to preserve their ability to become a mother, and not on a quantifiable “return on investment” perspective.