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The grace period in health insurance refers to the extra time, which you get when you miss the due date for renewal premium. Failing to make payment during the grace period can result in your medical insurance getting cancelled. Moreover, the insurance provider may also charge some penalties.
You receive a fair chance of paying your premium amount if you are unable to make payments due to some unforeseen situations. The duration of your grace period is dependent on the kind of insurance company and the health insurance policy you own. Also, it is not compulsory that all health plans offer the facility of a grace period.
Hence, when you compare health insurance plans, you should check with the insurance providers or the policy documents to see whether the concerned plan includes grace period benefit or not. You must also note that the insurance grace period is different from the waiting period.
In your waiting period, you have to wait for some time before filing an insurance claim, while grace period is the duration offered to you after the passing of your due date for making the payment of the premium.
However, for enjoying the benefits of your health plan, make your policy renewal, and premium payments on time. Try not to wait for the grace period for making payments.
If you miss the due date for the payment of premium, some health insurance providers may levy a late payment charge. In the situations where policyholders keep missing the renewal dates frequently, the insurance providers may ask them to pay a higher amount of premium during renewal.
In case you end up failing to pay your premium amount within the defined grace period, your medical insurance will get cancelled due to non-payment. In such a case, you will not be able to enjoy coverage benefits during hospitalization or health emergencies.
But you can buy a plan from other insurance providers. However, considering the worst possible scenario, you may also get refused by other insurance providers due to your previous records.
In case you plan lapses, some of the health insurance companies will ask you to go for a pre-medical test before the medical insurance plan is issued. It will put you at a higher risk of your coverage getting rejected or having to pay a higher amount of premium for a fresh plan.
Health insurance providers offer a time extension with a grace period in the hope that your health cover remains unharmed even when you make late payments and you can still file an insurance claim in the event of an emergency.
In the absence of a grace period or when you miss the renewal date, the insurance provider may reject the coverage due to late payment and you will not be able to file a claim even when you make the premium payment on the next day.
For example, suppose you skipped making your medical insurance premium payment on time and then also missed the grace period. In such a case, if a health emergency comes up, which needs expensive treatment and hospitalization and your insurance provider has cancelled your insurance plan due to non-payment., what will you do?
Not only this, but the insurance provider also rejects the coverage until the treatment gets over. In this case, your only option is purchasing a health insurance plan at a higher premium and starting the other terms & conditions that are applicable again.
In the above example, it is clear how a late payment of premium and failing to do a policy renewal can lead to inconvenience and cost you more. Hence, you need to ensure that you make the renewal of your medical insurance plan on time if you do not wish to take risks on your coverage. Even if you have the option of a grace period, don’t delay the payment till the time there is an emergency.
The Bottom Line!
Make sure that the next time when you make payment for your policy premium, do it on time. This way you can enjoy the benefits of continuous coverage. With increasing age, health issues also increase. And, if you have a pre-existing illness, purchasing a new health insurance plan will not be simple. You will have to compare health insurance plans again and the premiums will also be higher.