Health insurance has become one of the essential things in everyone's life in modern times. The primary reason is the increased cost of health care treatments, which can be challenging to cover with your savings. While health insurance offers many features and benefits, one such feature is the grace period, which benefits the policyholders in ensuring they are consistently protected.
Now, Let us discuss the grace period in health insurance in detail.
What Is The Grace Period in Health Insurance?
The grace period in health insurance is the period that health insurance companies offer to the policyholder to pay the premium amount for their health insurance at the time of renewal, even if the due date has passed. Generally, health insurance companies offer a grace period of 15 days to pay the renewal premium amount to the policyholders. However, some health insurance companies offer a grace period of 30 days for the same.
Suppose the insured cannot pay the premium of his health insurance plan within the grace period. In that case, the health insurance company has the right to reject the health insurance renewal application. Additionally, the insured will not get any coverage benefit during the grace period. Therefore, paying your health insurance premiums on time is essential as the grace period will reset the waiting period for some diseases mentioned in the policy document.
How Grace Period in Health Insurance Work?
You must pay all due premiums during the grace period to avail the continued coverage benefits of your health plan. Health insurance companies provide a grace period of 15 days to pay your due premium amount, even if you have missed the deadline. Read the example given below to understand better the grace period in health insurance: Mr X's health insurance policy expires on February 10, 2022, and he failed to pay the premium by the deadline. Then the health insurance company provides a grace period of 15 days to pay the premium amount. This means Mr X can pay his health insurance premium till February 25, 2022.
Disadvantages of Not Paying the Premium on Time
You cannot avail the coverage benefits of your health insurance plan without paying the health insurance premium. There are many disadvantages of not paying health insurance premiums on time. Some of the significant disadvantages of non-payment of health insurance premiums on time are mentioned below:
-
No Coverage Benefits
The policyholder cannot avail of any of the coverage benefits of the health policy if the health insurance premiums are not paid on time. Moreover, any claims that policyholders make during this period will be rejected by the health insurance companies.
-
Loss of Waiting Period
Health insurance companies provide waiting periods for critical illnesses and pre-existing diseases in health insurance policies. As per the terms and conditions of the health plan, you will have to complete the tenure of the waiting period again if you don't pay your health insurance premium on time.
-
Loss of No Claim Bonus (NCB)
Health insurance companies offer the customers a No Claim Bonus (NCB) if they do not make any claim during the policy term. This bonus is known as the No Claim Bonus. If you do not pay your health policy premiums on time, you will lose the No Claim Bonus.
-
Lapse of Medical Checkups
Health insurance companies offer free-of-cost medical check-ups to the insured after the waiting period. If you do not pay your health insurance premiums on time, you will lose the benefit of this free medical check-up unless the health insurance company offers it again.
-
Health Insurance Becomes Expensive after Revival
It would help if you bought a new health insurance plan when the existing health plan lapses. By buying a new health insurance plan, you will not only lose out on the NCB benefits that you have earned, but the premium for the new health insurance will also be higher.
-
Loss of Portability Benefit
Policyholders have the option to port their existing health insurance from one existing health insurance company to another. However, you will lose the portability benefits if your premium is not paid on time.
Health Insurance Companies offer Grace Period
Below mentioned is the list of the health insurance companies that offer grace periods to their policyholders:
|
Health Insurance Company |
|
|
Bajaj Allianz General Insurance |
92.24% |
|
95.47% |
|
|
89.46% |
|
|
78.62% |
|
|
IFFCO Tokio General Insurance |
96.33% |
|
The Oriental Insurance Company |
93.96% |
|
Magma HDI Health Insurance |
95.17% |
|
New India General Insurance |
92.68% |
|
78.67% |
|
|
Navi General Insurance |
86.98% |
|
86.52% |
|
|
Manipal Cigna Health Insurance |
85.72% |
|
Edelweiss General Insurance |
85.57% |
|
National Insurance Company |
83.78% |
|
Future Generali General Insurance |
82.96% |
|
Royal Sundaram General Insurance |
81.50% |
|
Liberty General Insurance |
81.03% |
|
66.08% |
|
|
74.09% |
|
|
Bharti AXA General Insurance |
76.01% |
|
United India Insurance Company |
78.03% |
|
Reliance General Insurance |
76.43% |
|
76.04% |
|
|
70.81% |
|
|
Kotak Mahindra General Insurance |
75.45% |
|
63.56% |
|
|
Universal Sompo General Insurance |
70.75% |
|
Cholamandalam MS General Insurance |
56.25% |
*Data has been sourced from the IRDAI annual report 2020-21
How Does Grace Period Affect Health insurance Premium Amount?
Many health insurance companies may charge you a late fee on your health insurance premium if you pay your premiums after the due date or within the grace period. Also, if you frequently miss your health insurance premium due dates, health insurance companies may charge you a higher premium amount at the time of renewal of the health insurance plan.
Grace Period vs Waiting Period
The difference between the grace period and the waiting period is not too much. To make you understand the difference between the grace period and the waiting period, refer to the below-mentioned table:
|
Grace Period |
Waiting Period |
|
Applicable to all health insurance plans |
Applicable in specific conditions like critical illness, pre-existing diseases, etc. |
|
24 hours to 30 days |
3 to 4 years (varies from insurer to insurer) |
|
Late fee or penalty may be applied |
No penalty or a late fee applied |
|
All claims will be rejected within this period |
All claims are approved other than the specific conditions like maternity, pre-existing conditions, and pre-existing diseases. |
How Can Grace Periods Affect Health Insurance Claims?
Health insurance companies provide a grace period of 15 to 30 days for policyholders to pay health insurance premiums to maintain coverage even if the health insurance premiums are not paid on time. If a medical emergency arises within this time, the policyholder can still submit a claim. But, if the renewal date is missed, the insurer may reject your claim. You will not be able to avail any coverage benefits of your health insurance within the grace period.
How to Renew Lapse Health Insurance Policy on Time?
Health insurance companies offer a grace period for policyholders to renew their health insurance at which time they must pay their health insurance premium with some interest or penalties within the stipulated time. Insured can renew their lapsed health policy via online or offline mode. Below-mentioned are the steps to renew your health insurance plan:
Through Online Mode
- Visit the official website of the health insurance company
- Login to your account through mobile phone, email id, and password
- Choose the premium payment option
- Make payment
- The health insurance company will send the policy document to your registered email address.
Through Offline Mode
- Visit the nearest branch of the health insurance company
- Fill in the renewal form
- Submit it with the required document
- Make renewal payment
- The health insurance company will send the policy document to your registered address.
Conclusion
If you don't renew your health insurance or pay your premiums on time, you may be inconvenienced during a medical emergency. Buying a new health insurance plan will be highly challenging if you have a pre-existing condition. Also, if you buy a new health insurance plan, you will have to serve the waiting period again. Therefore, you need to pay your health insurance premiums on time to get the uninterrupted coverage benefits from an exiting health plan. Unless there is an emergency, do not delay the premium payment even if there is a grace period.