Pay your health insurance premium on time and enjoy lifelong renewability

Accumulated no-claim bonus and advantage of having crossed waiting period will be lost if you fail to pay your health insurance premium on time

The Covid-19 pandemic has taught Indians not just the significance of buying health insurance but also renewing this policy on time. A recent study by Policybazaar.com showed that in FY 2021-22, 85 per cent of their customers renewed their family floater policies, and 80 per cent renewed their individual health policies, on time. Furthermore, 60 per cent chose to bolster their coverage with riders.

Lifelong renewability benefit

Timely renewal allows policyholders to avail of the benefit of lifelong renewability. Kapil Mehta, co-founder, SecureNow Insurance Brokers says, “If you don’t renew on time, and you have developed a health condition, the insurer can refuse to renew your policy. It can’t do so if you renew on time.”

Renewing on time is also essential if you wish to port or buy a top-up. “Porting can only be done 45-60 days before the expiry date,” says Amit Chhabra, head-health and travel insurance, PolicyBazaar.

Failure to renew means you have no coverage. The no-claim bonus (NCB) accumulated in the policy is lost. You may also have crossed the waiting period for pre-existing diseases. This benefit is also lost.

Buying a new policy would mean undergoing fresh underwriting.

Fortify coverage with riders

Many customers nowadays opt for riders at the time of renewal. One rider you could consider is critical illness. Dilshad Billimoria, board member, Association of Registered Investment Advisors (ARIA) says, “This rider can help cover the heavy costs that arise in case of a critical illness. It pays a lump-sum amount on diagnosis, which can help pay the various additional costs, over and above that of hospitalisation, that invariably arise in such circumstances. It can also substitute for loss of income.”

Most health policies don’t cover the cost of consumables (syringes, gloves, etc). Naval Goel, chief executive officer and founder of PolicyX.com, says, “Earlier, consumables accounted for 3-5 per cent of the medical bill. Post-pandemic their share has increased to 25-30 per cent.” Having this rider will mean you don’t have to pay for this expense out of your pocket.

Policyholders who don’t make an insurance claim in a particular year are rewarded an NCB. “Nowadays add-ons are available that can enable bonus accrual at accelerated rate,” says Ashish Yadav, head of products, ManipalCigna Health Insurance. 


 

Avail of wellness discount

Many health insurance policies now come with wellness benefits—reward points the insured collects by undertaking fitness activities, such as walking. These points can be used at the time of renewal to get a discount on the premium.

Younger people, in particular, can make the most of this feature. Debashish Roy, associate director, Anand Rathi Insurance Brokers says, “Buy a health policy at a young age. Since the probability of making a claim is lower, you will avail of NCB. In addition, you can accumulate wellness points to get a discount on the premium.”  
 

These wellness points can also be used to avail of medical tests and check-ups at network hospitals. Mehta says, “You could get a discount of 20 to 40 per cent on these services.”  

Port to policy with better features  

Even if the last date for policy renewal has passed, you still have the grace period. Yadav says, “If you pay within the grace period, you can keep the policy alive and enjoy all the continuity benefits.” The grace period is 10 days for policies where the premium is paid monthly, and 30 days where it is paid quarterly, half-yearly or annually.

Policies with better features are launched every year. Consider porting to one of them at the time of renewal. Billimoria says, “Some health providers are offering newer plans with reduced premiums for a similar sum insured. Check them out.”

You could also look for a policy offering guaranteed bonuses. “Each year your sum insured goes up by a certain percentage at no additional cost. This will protect you against medical inflation. This bonus is offered irrespective of whether claims are made,” says Yadav.