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During medical emergencies, health insurance plans keep the user ahead by taking care of the incurred expenses of the treatment. Though it is imperative to have a health insurance policy, it is also equally important for every policyholder to be aware of all the details of the policy. In this post, we will discuss how an insurance policy can be cancelled and the information about formalities related to pre and post cancellation policies. The first thing, however, is to ensure that you really want to cancel the policy and why.
Wondering, how to cancel health insurance policy? It is possible for an insurance policyholder to cancel his/her policy at any given time during the policy term. Also, it is not required for a policyholder to wait for the completion of the waiting period to cancel an insurance policy. However, the refund amount received by an insured for a cancelled policy depends on the time when the policy was cancelled.
Though cancelling an insurance policy is not difficult, however, it is important to evaluate and consider many things before taking the step. You should ensure the medical history of the family, about your savings in hand, as well as the number of people who are dependent on you. This is because the huge inflation in the medical industry has made even the basic healthcare treatments too expensive these days. Thus, if you are the sole bread earner in the family, it becomes all the more important to stay covered under a family floater health insurance policy. Thus, considering all such things is very important before cancelling a policy.
Let us discuss some significant points that a policyholder must consider before buying a health insurance plan.
Below are some questions that a policyholder must try to find the answers for before making the policy cancellation decision.
However, if you have made up your mind and are sure about cancelling your health plan, below are the details regarding health insurance policy cancellation to guide you better.
Also Read: What is Health Insurance with OPD Cover?
Free-look period is a time duration of over 15 days (from the policy initiation date) that is allowed with every insurance policy. During this time, the policyholder can plan to cancel the policy and get the entire premium amount refunded. The free look period allows the insured to ponder upon the policy terms and conditions and to continue or cancel it as per consideration.
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There may be deductions in the refunded amount such as:
Sometimes, a policyholder might miss out on cancelling a policy during the 15 days free look period and may want to cancel it after the period is over. In that case, the policyholder may not be entitled to get the 100% compensation of the premium amount by the insurer.
Here, the deductions in the refunded amount includes:
Time Duration | Deduction |
Within 1 month | Policyholder is eligible to receive 75% of the premium paid |
Within 3 months | Policyholder is eligible to receive 50% of the premium paid |
Within 6 months | Policyholder is eligible to receive 25% of the premium paid |
After 6 months | Policyholder may not receive any amount as insurer is not liable to pay anything after 6 months of the policy |
Cancelling a health insurance policy can be done in simple steps as follows:
Read More: What is the Free Look Period in Health Insurance Policy?
To Sum Up
It is a hassle-free process to cancel an insurance policy. However, it is very important to consider all aspects as mentioned above before going ahead with the cancellation plan. Insurance is very significant for everyone as it secures the policyholder from any financial turmoil caused due to medical emergencies.
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Yes, it is possible to cancel your policy after paying the premium during the policy term. The insurer must oblige with your policy cancellation request and refund the remaining balance as per the terms of the policy. You must read the policy document well before purchasing a health plan to understand the terms of cancellation. Though cancelling a policy anytime during the policy period is possible, it is advisable not to cancel the plan without any significant reason. You may also note that the amount refunded depends on policy cancelation time or when the policy was cancelled. Free - look period is a time duration during the start of the policy just after buying it, while grace period is the time during the end of the policy-term at the time of policy renewal. Free-look period ranges from 15-30 days, grace period mostly allows 30 days time. The policyholder can cancel a policy under free-look period if they find the terms of the policy unsatisfactory and get the total premium amount returned. Grace period allows policyholders enough time to renew a policy in case the insured miss out on the policy renewal date. No, after the free-look period, you cannot get a 100% refund of your policy as you may have to pay a cancellation charge, which differs as per the insurance company. Further, you may receive a refund of the remaining amount accordingly. FAQs on Steps to Cancel Health Insurance in India
Is it possible to cancel my insurance policy and get my money back?
Can I cancel my health insurance anytime I wish?
What is the difference between grace period and free look period?
Will I get a full refund if I cancel my Health Insurance after the free look period?
PayBima Team
PayBima is an Indian insurance aggregator on a mission to make insurance simple for people. PayBima is the Digital arm of the already established and trusted Mahindra Insurance Brokers Ltd., a reputed name in the insurance broking industry with 17 years of experience. PayBima promises you the easy-to-access online platform to buy insurance policies, and also extend their unrelented assistance with all your policy related queries and services.
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