Health Insurance

Facts about Grace Period in Health Insurance

Nov 27, 2021

All types of health insurance plans have a component of grace period associated with them. This means if you do not pay the premium on time and the policy lapses, you will still get a period of time to pay the dues and get the plan reinstated. This clause applies to the various health insurance plans too. If you have any doubts regarding the grace period in health insurance, take a look at this article and get your doubts cleared easily.

Understanding Grace Period in Health Insurance 

Every health insurance plan comes with a renewal date. If you do not pay the premium and renew it by that day, your policy will lapse. However, every insurance provider offers a grace period of 15 days. Some insurance companies extend the grace period to 30 days also. To understand the grace period available on your health insurance policy, you need to read the health insurance plan carefully. If you renew the plan within the grace period, the policy coverage gets reinstated and you once again become eligible to make a claim.

Renewing the Health Plan within the Grace Period

It is quite straightforward to renew your plan within the grace period. Most insurance companies keep the steps simple. All you have to do is pay the existing premium and make the coverage active again. Here are some important factors related to the grace period that you must remember:

  1. Claim cannot be made - 
    The biggest problem is that you cannot make a claim on a lapsed health insurance plan, even if the grace period is on. To be able to make a health insurance claim, the plan should be active continuously. So, if your health insurance is in a grace period and you need to make a claim, ensure you pay your premium first, get the policy active and then you can file a claim.
     
  2. Late fee may be applicable - 
    Some insurance companies may levy a late fee if you renew the health insurance policy in the grace period. As stated, the clauses, terms and conditions are different from each insurer, so you need to see what conditions your insurance company has related to the late fee.
     
  3. It may be listed in the record - 
    Most insurance providers offer the benefit of the grace period. However, if you are found to be delaying your health insurance renewal regularly, your insurance provider may list you in a record of defaulters. This may work against you in the future.

Reinstate your policy within the grace period and enjoy the benefits of your health insurance coverage with ease.

Problems Faced when the Grace Period Ends

If you do not make use of the grace period and delay the renewal of your lapsed health plan, your plan may permanently lapse. You will face the following problems thereafter:

  1. No coverage - 
    The biggest problem you will face is the complete discontinuation of the health insurance cover. If you happen to get ill during that time, you will have to pay all the medical bills out of your own pocket. This may become very difficult for you and you may not even be able to afford the best health care facilities at such a time. This is why you should never let your health insurance policy coverage lapse.
     
  2. Reset of waiting period - 
    Another major problem would be the waiting period would get reset if the policy lapsed. All the pre-existing disorders and their waiting period clause would get back in force and you will again have to wait for years to get the cover you need. This can be a huge issue and you will be denied the cover you deserve to get.
     
  3. Undergoing health screening again - 
    Then, you need to undergo the health screening once again. This is because the policy that you reinstate after it lapses will be treated as a new policy. For that, you have to make a fresh application and undergo a fresh health test as well.
     
  4. Higher premium - 
    In all likelihood, your health insurance premium will also go up. Your health screening may expose some newly acquired health conditions or your age may have gone up. As a result, the premium rate will go up. This is another problem you will face when you allow your health insurance plan to lapse even beyond the grace period.
     
  5. Blacklisting by insurance providers - 
    If you happen to default on the policy renewal, again and again, you may be blacklisted by one or even more than one health insurance company. No one may even want to issue a health insurance plan to you and that will make it very difficult for you to get health coverage for yourself and your family.

To ensure these problems don't affect you, renew your health insurance plan on time and stay protected in a comprehensive and wholesome manner. 

Also Read : Features & Benefits of Family Floater Health Insurance

The final word

Make full use of the grace period if by any chance you forgot to renew the health insurance policy before the renewal date. It is important to renew your plan on time and to have very good health coverage for yourself.

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