Buy Health Insurance Policy

Health insurance policies are an essential investment, especially given the rising medical costs in India. They safeguard against financial setbacks while seeking medical treatment. However, remember that health insurance policies are usually offered as one-year plans and must be renewed annually.

Have there ever been instances where you neglected to pay your health insurance premiums?

Life can easily sidetrack our daily responsibilities, and we periodically need to remember to do essential activities like paying our bills and wondering what happens if we wait to renew our health insurance on time.

Read the article to learn more.

There are many disadvantages to not renewing your health insurance on time. A few of them are listed below:

1. Interruption in Coverage

When you don’t renew your health insurance on time, and also forget to pay the premium within the grace period, the policy becomes inactive. This means that any claims filed between expiry and renewal will be rejected. And, when your policy lapses, you will have to buy a fresh health insurance cover.

You will not be covered for any medical emergency or hospitalization during this period, and will have to bear all the healthcare expenses out of your pocket.

2. More Waiting Periods

As we’ve seen above, when your policy lapses, you need to buy a new health insurance policy. In this case, the waiting periods from your previous policy will also lapse. These include waiting periods for pre-existing diseases, maternity benefits, and a number of other treatments and conditions, all of which you will have to complete once again from the start.

3. Loss of Your Cumulative Bonus

When you don’t make any health insurance claims during a policy year, upon renewal you will get the benefit of a cumulative bonus. This is when your insurer increases your sum insured without charging you any extra premium for it.

However, when you don’t renew your health insurance policy before it expires, you will lose the opportunity to earn this bonus.

4. More Expensive Premiums

When you don’t renew your health insurance policy on time you must buy an entirely new policy. And for this policy, your premium will be calculated from scratch, and due to both the lapsed policy and as you will be older, you may end up paying a higher premium than if you had renewed the policy on time. Thus, renewing a lapsed policy is more expensive.

5. Medical Check-Ups May be Required

When your policy lapses and you need to buy it again, your insurer might ask you to undergo some medical tests or check-ups, just to check the status of your health before issuing the policy. This may be a lengthy process and delay getting the policy, during which time you will not have coverage. Additionally, the medical exams might uncover previously unknown conditions which might increase your premium.

6. Loss of Income Tax Benefits

Under Section 80D of the Income Tax Act, 1961, when you pay a health insurance premium for yourself, spouse, parents or children, you can claim tax benefits and returns. But, when you fail to renew your policy, you will lose these savings for that year.

Like every other insurance policy, health insurance also needs to be renewed each year to ensure that you can avail of all of its benefits. And these days you can easily renew your health insurance policy online with a few clicks, it has become easier to do this.

Even if you choose to port your existing policy to a different provider, you must let your existing insurer know at least 45 days before expiry. If you do this afterward, you will not be able to transfer your waiting periods and no claim bonus.

7. Loss of Portability

Transferring your current coverage to a new health insurance provider allows you to change providers. However, you can no longer transfer your coverage to a better insurance provider after it expires. You then have to apply for a new policy with the potential provider, which may be subject to additional underwriting and, therefore, more costly. The coverage benefits that you may have will also not be transferred to the new policy.

There are numerous justifications for promptly renewing your health insurance policy, such as:

1. Preventing Policy Expiration

You can forfeit your no-claim bonus and be unable to file claims if your insurance expires.

2. Keeping Premiums From Rising

If your current insurance lapses, you might have to buy new insurance with a higher premium.

3. Refusing Needless Medical Examinations

By renewing on time, you can avoid some plans' prerequisites, which require medical exams before renewal.

4. Maintaining the Current Premium Rate

If you renew on time, you can maintain your existing premium rate, which is determined by your age, health history, and coverage length.

5. Retaining the Plan's Benefits

If you renew on time, you can continue to enjoy the plan's benefits uninterrupted.

6. Supporting Tax Advantages

Section 80D of the Income Tax Act provides tax benefits for the premium you pay. Discounts for long-term policies Multi-year health plans are eligible for savings from some insurance providers.

Your grace period is the additional time you have if you miss the deadline for renewing your health insurance coverage. Penalties or cancelling your mediclaim coverage may result from failing to complete the payment within the grace period. There is typically a grace period on health insurance coverage.

If you cannot pay your health insurance premium because of unanticipated circumstances, the grace period gives you a fair opportunity to do so. Most insurance providers provide a 15-day grace period to pay medical insurance renewal premiums. However, some businesses additionally offer a 30-day grace period.

The following ways may be helpful if your insurance policy offers a full range of benefits and you don't want to deal with the hassle of having your expired coverage revived:

You can bring your policy back into effect by making the overdue premium payment with interest. The methods listed below can help you renew your expired policy: