Updated: April 20, 2021 2:24:30 pm
Written by Amit Chhabra
The last 12 months have been a game-changer for the health insurance industry as awareness around health insurance increased by multiple folds. The year 2020 saw health insurance become the most valuable segment in terms of premiums collected and lives insured as over 300 million lives were insured under health insurance from April – September 2020.
The two key factors that have driven maximum Indians to sign up for health insurance policies are – high prospects of hospitalisation due to COVID-19 and excessive treatment cost in private hospitals. While there was a sudden drop in the number of COVID-19 positive cases from October 2020 – March 2021, the situation is worrisome again as India continues to report over 1.70 Lakh COVID-19 positive cases since the last one week.
Amidst the apprehension and uncertainty concerning the present scenario, we must evaluate the risks if the worst happens. Evaluating the risk primarily involves creating an adequate financial blanket to pay off the hospital dues if you or your family members fall prey to the virus.
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For people who bought health insurance during this time last year, it is very important for them to renew the policy before the expiry date and for those who have yet not purchased a health plan, they must not delay the decision any more. Akin to all other types of insurance policies, a health insurance policy also needs to be renewed annually to reap health insurance policy benefits without any hassle. You can easily renew your health insurance policy online within a few clicks from the insurer’s website or any of the online insurance market places.
It is entirely your prerogative on how and from where you wish to get your health insurance policy renewed but make sure to renew the policy before it expires. Here are some of the prominent disadvantages of missing out on your health insurance renewal date.
Interruption in coverage
Until your health insurance policy is active, the insurer will continue to provide you adequate coverage and will cover hospitalisation expenses for the treatment of any ailment. However, if you fail to renew your health insurance on the renewal date, the policy becomes inactive.
Under a health insurance plan, any claim filled while the policy is inactive will not be entertained by the insurer and will be straightway rejected. Though every insurer provides a grace period of 30-days to revive the expired insurance policy, you still cannot make any claim during the grace period or till the time your policy again becomes active.
If you are hospitalised while your policy is inactive, the insurer will not provide any coverage. And, if you fail to renew the policy even in the grace period, your policy will lapse and the only solution you will be left with is to buy a fresh health insurance cover.
Moreover, given the significant rise in the number of COVID-19 positive cases each day, you must not take the risk of staying uncovered under a health insurance plan as you never know when you may need the coverage.
When you buy a new health insurance policy, it comes with a mandatory waiting period that you need to serve before making filing a claim. While there is no waiting period on hospitalisation due to an accident, there is a 15-days waiting period on hospitalisation due to COVID-19 and a 30-days waiting period for all other ailments. For pre-existing ailments and other common conditions like maternity cover, Knee Replacement Surgery, Cataract and many more, there is a waiting period ranging between 2 – 4 years.
Now, if you do not renew your policy on the renewal date or even during the grace period, your health cover will lapse and you will need to buy a fresh health insurance policy. Under a new health insurance policy, you will need to serve the waiting period for different conditions again and in case during that period if you get hospitalised for the treatment of that particular condition, your insurer will not pay for the hospitalisation expenses. You will lose all the benefits earned by serving the waiting period and will need to start the process again.
Yet another prominent advantage that you may lose if you fail to renew your health insurance cover with the time period is a no-claim bonus. It is not always important that if you have bought health insurance coverage, you will make a claim every year and for every no-claim or claim-free year, the insurer awards you with a no-claim bonus.
The bonus can be in the form of an enhanced sum insured of your existing health insurance policy or discount on health insurance premium at the time of renewal. You can only avail the benefits of the no-claim bonus at the time of renewal however if you fail to renew the policy within the given time period, you cannot take advantage of the NCB benefits.
The author is Head-Health & Travel Insurance at Policybazaar.com. Views expressed are that of the author.
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