One loose loop of umbilical cord
around the baby 's neck is definitely not a contraindication to normal delivery.
You can definitely opt for it.
If you are sensitized, and your doctor foresees complications to the baby, then routine induction at 38 weeks is definitely recommended.
Well, induction is done in order to aim at normal delivery, so be positive.
Even if you land up having a Cesarean section, the primary aim is to have a healthy mother and child, irrespective of mode of delivery.
Trust your obstetrician.