If health insurance is not renewed on time

K. Aravind

Ratheesh’s health insurance policy renewal date was November 1. But he did not remember to renew it on time. Ratheesh recalled that he had not renewed his health insurance policy when the doctor told him that he would have to undergo an operation at the end of December. He decided to pay the premium immediately but could not renew the policy. The grace period for renewing the policy was already over. That is, he had lost policy coverage. He then had to bear the entire cost of the hospital on his own.

Some of the health insurance policyholders, like Ratheesh, do not remember to renew the policy on time. The result is a loss of policy coverage until then. When one has to get expensive treatment in hospital, they are without any protection. Moreover, with the premium paid for such a long time to get the coverage, it goes without any benefit. The consumer also loses the premium paid for so many years.

Care should be taken to renew the policy on time to avoid such situations. It would be best to pay the premium before the date of renewal. The insurance company usually sends a renewal notice 45 days before the policy renewal date.
The grace period of insurance policies is 30 days. That is, the policy can be renewed within 30 days from the date of renewal of the policy by paying the premium without penalty. At the same time policy coverage will not be available during the grace period. Coverage is only available until the policy renewal date. Therefore, no coverage will be available for hospital expenses in the days prior to the renewal of the policy during the grace period. The coverage will be available again after paying the premium.

The policy cannot be renewed after the grace period. Therefore, if the premium is paid after the grace period, it will be equivalent to taking out a new policy. If necessary, a medical examination may be needed. The waiting period when applying for a new policy will apply again. For example, if the policy of the previous policy stipulates that coverage will not be available for existing illnesses for up to four years, this will come into play again. The four-year waiting period is applicable again even if the earlier policy was taken two years ago.

Another drawback is that the no claim bonus is lost. No claim bonus will be available if there is no claim in the first years after taking the policy. For example, suppose a policy of Rs. 5 lakhs receives a no claim bonus of Rs. 50,000 in that year. This bonus will be forfeited if the policy is not renewed on time.