We buy health insurance for the peace of mind it brings us, as well as for the convenience of being able to seek cashless services from a wide network of hospitals at the time of an emergency. This is a stressful time when the last thing one wants to do is run around trying to raise cash. Renewing health insurance on time not only gives you uninterrupted peace of mind, there are other benefits of this as well. We look at the benefits of renewing health insurance plans on time.
The best health insurance plan is of little use if it is allowed to lapse. Renew your policy on time to continue to enjoy the protection of a health policy and to ensure that you have the peace of mind of knowing that you and your family are protected.
Accrued benefit - Renewing health insurance on time has benefit beyond the obvious one of uninterrupted coverage. You can also take advantage of any special discounts or incentives that your insurance provider is offering you for renewing on time. If you have not made any claim under your health insurance plans in the preceding one year, you also have the advantage of a No claims bonus which can be in the form of an increase in Sum Assured by a pre-defined amount for the same premium or added coverage features / policy riders for the same premium amount.
Renewing Health Insurance provides you theTax Benefit:
Buying health insurance or a mediclaim policy, the policyholder becomes entitled to significant tax benefits or income tax rebates under Section 80D. To continue to enjoy the tax benefits you should ensure renewing health insurance on time.
A lapsed plan will cost you:
You have chosen the best health insurance plan for your needs and have made a careful choice based on your requirements and lifestyle. By not renewing health insurance on time you are relinquishing the many benefits that have accrued on your policy. Generally, there is a waiting period of 30 days after the issuance of a mediclaim policy before you can make a claim on the policy. This waiting period will start ticking from the beginning yet again when allow your existing policy to lapse and delay renewal. There is usually a waiting period of one to three years (depending on the plan you have chosen) for making a claim for pre-existing diseases. This will also be calculated from the date of first purchasing a policy and is deemed to continue to run each for each year that the health policy is renewed on time. Here again, you would be deemed to have purchased a new policy and will lose your accrued benefits if you permit your existing policy to lapse.
You may not be able to buy a new policy after a certain age:
If you purchase a health policy at an appropriate age; for instance when you are in your forties or even earlier and then continue to renew it on time for the next few years, you will be protected by the policy continuously according to the terms and conditions therein. However, if you decide to let that policy lapse for any reason (you may mistakenly think that it is unnecessary if you had no cause to make a claim in that duration) you and your family are unprotected for that duration. Furthermore, you may not be able to buy insurance as easily later in life. Insurance companies are reluctant to issue policies to older people because they usually have some pre-existing diseases and have a higher likelihood of developing diseases or chronic conditions.
Health Insurance plans become more expensive with age:
The younger you are when you buy health insurance, the lower are your premiums. Hence, if you buy a health policy when you are young and then allow it to lapse, you will find that a health policy becomes quite an expensive proposition later in life.
Clearly there are several excellent reasons for renewing Health Insurance on time. Continued protection of your family's health and well-being as well as peace of mind is just one of them. From the foregoing it is obvious that there are financial and practical reasons why you should renew your health insurance before the date of expiry or within the allotted grace period after the end of the policy.