At times, after you take a health insurance plan, you may realize that it does not match your expectations or you might feel dissatisfied with the same. Other times the policy might not be suitable for you after a certain span of time. In these cases, it makes sense for one to terminate the existing health insurance plan.
Free look period for a policyholder is the period during which the insured can cancel their health insurance plans without any surrender charges. Such free look period is 15 days from receipt of the copy of the policy or 30 days in case of online policies. When you wish to cancel a health insurance policy, you must cancel it in writing. You are required to submit a written application to the insurer without the need to specify the reason for cancellation. The initial premium is refunded in full deducting the necessary administrative charges for stamp duty, and medical examination conducted if any. One must note that the free look period is applicable only for new health insurance policies and not for renewals.
A few medical insurance can be cancelled after the free look period as well. It is termed as a short period cancellation. For a cancellation that takes place within 30 days after the free look period, a premium for 90 days is deducted, and the balance is refunded. For cancellation within three months duration, the premium for six months is deducted, and balance is refunded to the policyholder. For any cancellations post six-month duration, there is no refund of the policy premium, but the mediclaim is cancelled.
Following steps can be followed on the cancellation procedure.
- Policy documents should be read and compared with the initial policy introduction as provided.
- Reach out to the insurer about willingness to cancel the policy during the free look period.
- The insurer shall provide an endorsement and refund the amount within seven days of acceptance of the policy documents.
- One might wish to port the policy which is not allowed during the free look period. It can only be done at the time of renewal.
You might think that it is a very complicated process to terminate your medical insurance; instead, the above few steps need to be kept in mind to get the best bang for your buck. Getting the right health insurance plans for you and your loved ones is crucial to have a stable financial position during your future. Therefore if you feel the existing health insurance policy does not check all your boxes, you can terminate and buy a new mediclaim cover that better suits your needs.