If you already have a health insurance policy, then you must be aware about renewing your policy annually to avail the benefits of the same. By the renewal of your policy on time, you can avail the benefits like waiting periods of lesser duration to get over, No-claim bonus, etc. Even though there is the provision of Grace Period for making the payment of renewal fee, you would not be covered for any health problems during this period.
Let us check out the most important tips or pointers that you must remember while renewing your health insurance policy .
Checkpoints Before You Renew Your Health Plan
1. Renewal of the Policy Before the Due Date
In case of non-payment of your health insurance premium within the due date, your health insurance provider would provide a grace period. This grace period is a 30 day period within which you must renew your policy before it lapses. According to the regulations of the IRDAI, during this grace period, there would not be any health insurance coverage during this time.
Moreover, you might not be able to avail the benefit of lifelong renewability if you miss out on the renewal as per the due date. Also, you could miss out on the credit for the waiting periods and the specific waiting period which is available for some specific illnesses. There are possibilities that you won’t be able to enjoy the tax benefits under Section 80D of the Income Tax Act, 1961 as well.
Nowadays, health insurance companies send regular reminders to you for the premium payment before the due date. But, this is not a mandate by insurance companies thus you must be prepared on your own to set up reminders about the premium due date.
2. Review Your Requirements
One of the major tasks involved in health insurance is the review of your health insurance needs. The renewal time is the best time for the analysis of your health insurance needs.
The evaluation of your health insurance requirements for your family is necessary as there might have been some changes in your life in the last year. For example, if there has been the death of an old family member in your family who was included in the health insurance plan or if there has been the birth of a baby in your family. Also, you might have changed your job and there is no Group health insurance plan available as it was provided by your previous employer. Policy renewal is the best time during which you can easily adjust your health insurance coverage according to the financial requirements of you and your family.
3. Change the Policyholder If Necessary
When you go through the wordings of your policy document carefully and understand the terms and conditions, you can find out that change in the policyholder can be done at the time of policy renewal only. You would be able to claim a deduction for the health insurance plan which you have purchased for your parents. Moreover, you can implement a good tax planning strategy during this period i.e. you and your spouse can pay separately the tax premium for your parents and then claim the deduction for your parents on your individual income tax returns.
Moreover, you can also think about implementing another strategy i.e. you can only be the policyholder in that policy which contains only you. In another policy, your spouse would be the proposer which would contain her and your kids. By this, both you and your spouse can claim the tax deductions on your individual tax returns.
4. Increase in Sum Insured
Once you review your insurance requirements and find out that you and your family would need increased coverage, then the sum insured can be increased. The time of renewal is the best time at which the sum insured of your health insurance policy can be increased. If the increase in sum assured is quite significant then the insurance provider can impose certain specific conditions like No claim history and the need for medical tests.
There might be a scenario in which the increased sum assured of your health insurance policy would be equal to the maximum cover which is allowed under that health insurance policy. In such a situation, you would not be able to increase the sum assured of that health insurance policy but can explore and find out a super top-up health insurance plan from the same health insurance provider or even some other provider.
5. Changes in Policy Terms and Conditions
The terms and conditions would remain the same at the renewal time of the health insurance policy. According to the IRDAI guidelines, the insurance provider cannot change them based on an adverse claim experience. If any changes are to be made in the benefits or the insurance premium then they have to be done by the IRDAI’s approval. If you are not satisfied with the terms and conditions that have been revised, you can migrate from one health insurance plan to another or you can opt for portability to a new insurance provider.
6. Disclosure of Any New Health Condition
Renewal in the health insurance contract is a yearly event and must have the same terms and conditions as that of the previous year. But, there might be some changes in your health conditions during the previous year. Even though the insurance provider would call for necessary documents or information during renewal rather than refusing to load the policy, it is advisable to inform the insurance provider about any change in your health condition in advance.
7. Preserve the Receipt and Update Your Spouse
Once you have paid the health insurance premium, it is advisable to inform your spouse or any other senior family member about this fact. This must be done so that your spouse and other family members are not unaware of these changes during the claim procedure. Moreover, you must also follow regularly with the Third Party Administrator for issuing the Cashless Health Insurance ID cards. Your spouse or other family members must know where your insurance documents are kept for use at the time of need.
8. Consider a Long Term Health Insurance Plan or Set up an ECS
If you are forgetful and you surely wish to renew your health insurance plan, then you must opt for a long term health insurance plan or at least set up an electronic clearing system or an ECS for auto-debit of the same from your bank account or credit card. Doing so would be helpful in paying your premiums on time.
Conclusion: Before Renewing Health Insurance
Mostly, people think that they can rest assured if they have purchased a health insurance policy. However, purchasing the health insurance policy is as important as the renewal of your health insurance policy. Moreover, there are certain activities such as an increase in the sum insured and also the change in policyholder, etc. which are feasible only at the time of policy renewal. So, you must be very careful about your health insurance policy renewal due date and must have made all the necessary arrangements required for the policy renewal rather than leaving it for the last minute.
