Key Factors to Review Before Renewing Your Health Insurance

In India, health insurance renewal is not a mere annual formality of submitting your renewal premium. In a world of evolving medicine and rising costs, at a time of policy renewal, it is important to be well prepared. Here are 10 key factors to keep in mind as you go through the health insurance renewal process:

• Assess Your Health Needs and Coverage Situation

One of the first things you need to consider is whether your current policy offers the right kind of coverage for your life stage. With time, the protection needs of an individual or a family change. With time new types of risks emerge and to cover these you may need to make additions to your policies in the form of riders or a brand-new policy. For example, as you get into your thirties, you might want to add a maternity cover to your policy. Similarly, in forties and fifties, a critical illness cover makes a lot of sense. There are many such risks which should be analysed at the time of health insurance renewal. 

• Evaluate if your policy Sum Insured is sufficient

Medical inflation is a reality and the cost of treatment is going up every year. In that light, what was a sufficient sum insured a few years ago may now be insufficient. In India medical inflation is estimated to be 15% which roughly speaking means that every five years the value of your coverage drops by 50%.  So, a policy cover of 25 lac today, in 5 years’ time, will be equivalent to only 12.5 lac cover today. This is something you must consider at time of health insurance renewal. A common mistake customers make is that they take confuse the no claim bonus sum assured in a health insurance policy as a permanent increase in their coverage. That is not the case. No claims bonus, while very useful, is not a permanent increase in your sum assured. It will stop applying the year after you make a claim. Hence, at the time of renewal of your health insurance, look up if your health insurer is offering a gradual increase in sum assured in your policy. And you should definitely consider buying top up health insurance to boost your coverage. 

• Read Review Policy Terms and Conditions

One basic difference between life and health insurance policies is that life insurance is long-term contracts running into decades. Whatever Terms and Conditions get decided at the start of the contract will apply for the duration of the contract. Health insurance contracts are one year in duration. When you renew your health insurance policy, it is a new policy which carries forward the risk coverage of previous policy. Since the contract is new, terms and condition of the insurance policy may change at the time of renewal. Insurers are mandated by IRDAI to disclose such changes at the time of health insurance policy renewal, but most customers tend to skip these details. Be sure to read the fine print to see if this means any changes in what’s covered or excluded, waiting periods or claims processes. Awareness of these changes helps avoid shocks on claim settlements.

• Compare Premiums and Benefits and think about Portability

Remember how you compare premiums of motor vehicle every year before renewing? Now, while that might not be directly applicable to your health insurance policy due to provisions of waiting periods, at a time of health insurance renewal, you should still shop around and see what is the market looking like. Different insurers offer differing benefits at different price points — this makes for competition in the insurance market. Compare premiums and benefits of your existing policy with other options before renewing. That doesn’t always mean changing insurers but that you’re getting what you pay for. But the cheapest policy isn’t necessarily the best — you want to pay attention to the coverage and services that are included.

Policyholders have the option to port from one provider to another without losing accrued benefits — such as waiting periods for pre-existing diseases or some other benefits — in case they are dissatisfied with their current insurer’s services or the terms of their policy have become outdated compared to their needs, according to the Insurance Regulatory and Development Authority of India (IRDAI). To ensure a smooth transition, start the portability process at least 45 days prior to your existing policy’s expiry.

• Verify the Network Hospitals with the Insurer

One of the biggest advantages is for hospital networks, particularly those that provide cashless treatment. Make sure your favorite hospitals are on the insurer’s network. It helps in smooth admissions and claim processes in case of medical emergencies.

• Understand the Grace Period

It is essential to renew your policy on time to ensure you have uninterrupted coverage. Most insurers provide a grace period (generally 15 to 30 days) after the due date before you will lose benefits when you renew your policy. But claims made during that period may ultimately not be honored, so it’s best to get the renewal before the due date to prevent any gaps in coverage.

• Report New Medical Conditions

Most of us understand that being clear and honest with your health insurer at the time of buying a new policy is critical. However, it is also required at the time of health insurance coverage renewal. If you have new health issues since your last policy period, inform during a policy renewal as well if your health insurer asks you for it. This is particularly important if you are adding more sum assured to your policy at a time of health insurance renewal. This additional sum assured is treated as a new cover. 

• Keep Documentation and Records

Stay organized with all your policy and medical documents. That includes previous policy claims, medical reports and communications with the insurer. Maintaining proper documentation promotes hassle-free renewals and filing of claims.

• Utilize Wellness Programs

Now, many insurers provide wellness programs that reward policyholders for maintaining a healthy lifestyle. Joining these programs may qualify you for premium discounts or other benefits upon renewal. Regular health check-ups, fitness programs, and wellness challenges not only keep you healthy but also lower your insurance cost.

• Get Professional Advice 

For a general understanding of insurance policies, we suggest reading articles like: If you have questions about any part of your policy or the renewal process, contact an insurance advisor if you haven’t already. They can offer tailored advice based on your health needs and financial situation.

The bottom line is that renewing your health insurance policy is a crucial time to review and make sure your coverage keeps pace with your changing needs. Through the careful evaluation of your health status, the understanding of policy details, the exploring of additional benefits, and open communication with your insurer, you can find a policy that provides wide-ranging protection and peace of mind. And, above all, proactive and informed decisions you make today can help protect your health and finances for the future.