A health insurance policy has a predetermined length of time. This position is typically held for a year. But what should you do if your health insurance coverage expires? These days, health insurance policies often come with lengthier terms. There are some plans that you can purchase for a continuous period of two or three years by making a one-time payment of the two-year or three-year premium. These long-term plans not only do away with the burden of yearly renewals, but they also reduce the cost of the premium due to premium savings for selecting longer periods. When the policy’s length expires, renewals are necessary even for long-term health plans. Your health insurance policy expires if you fail to renew the plan by the deadline.
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Let’s find out what to do and how it impacts the policyholder when a health insurance coverage expires.
What Does a Health Insurance Policy Lapse Mean?
The health insurance policy would lapse if it is not renewed before the policy’s expiration date. Health insurance protection will end once the policy expires. The scope of the plan’s coverage ends once the health insurance policy expires. If a claim is made under a policy that has expired, the insurance provider will not make any payments because the coverage has ended.
When a Health Insurance Policy Expires, What Should You Do?
In order to continue receiving the same coverage advantages if your health insurance plan has expired, you should pay the renewal premium as soon as possible.
Grace Period Renewal: Plans for health insurance have a grace period. After the insurance has expired, this window allows the payment of the renewal premium. A 30-day grace period is typically provided by health insurance companies. The policy can be reinstated if the renewal premium is paid during the grace period even though the policy has expired. In a policy that was renewed during the grace period, the continuity benefits of a shorter waiting period and a no-claim bonus would be applied.
Things to consider regarding the grace period: There is a grace period for renewing a lapsed health insurance policy, but that period is not a period during which coverage is available. Even if a claim is made while the insurance is still in its grace period, the corporation would not pay any benefits.
Why should a Lapse be avoided? Prior to the health insurance plan expiring, it is always preferable to renew it. The following are some causes for avoiding lapses:
No Coverage in the interim period: There is no health insurance coverage in a lapsed policy. Given the high medical costs, these expenses could burn a hole in your pockets.
Portability: A lapse prohibits your ability to port to a different company. If you want to change your health plan because of any service issue or better coverage features or any other reason, you lose the ability if the health insurance policy lapses. The request of porting should be made 45 to 60 days before the policy expiry date and not after the expiry of the policy period.
Renewal Benefits: If the policy is not renewed during the grace period, you lose the renewal benefits of your existing health insurance plan.
Waiting Period: In case of a lapse, you lose the continuity benefits of the waiting period on pre-existing diseases. The reduced waiting period on pre-existing illnesses and other treatments. You would, then, have to buy a fresh health insurance policy with a fresh waiting period from two to four years or as defined by the underwriter.
Limited Scope of New Policy: If you are a senior citizen, you might find new health plans to have a limited scope of coverage than your lapsed health insurance plan. Even for others, your new ailment might not be covered under pre-existing clause, which would have otherwise been so, in your previous plan.
Lifelong Renew ability: Moreover, lifelong coverage is allowed only if the policy is renewed without a break. If the policy is not renewed within the grace period, you might not find a health insurance plan for your age.
No Claim Bonus: Even the accumulated no claim bonus for not claiming in the previous years would be lost if the policy is not renewed on time.
How to Renew/Revive Lapsed Health Insurance Policy?
However, if your health plan has not been renewed and has lapsed beyond the grace period, all you need to do is buy a fresh plan. Since the same cannot be renewed now, you can either continue the same plan with your earlier insurance company by simply paying the premium and undergoing a pre-medical check-up, if the lapse is more than 6 months or compare and then buy a fresh health insurance plan for yourself which suits your needs the best.
Small steps to ensure that you do not lapse your Health Insurance Plan next time
1. To ensure that you receive renewal calls, emails, etc., update your email address and phone number with the insurer as soon as they change.
2. You can also create a standing instruction on your account, credit card, etc. so that the renewal gets automatically processed even if you are busy or out-of-the-country or unable to pay within the grace period. This way, you can never miss your renewal lifelong!
There is no justification for forgetting to pay for renewals now that we have technology on our side. It can be completed quickly and easily by clicking a button using net banking, phone banking, mobile banking, etc.