Steps to cancel health insurance policy in India

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Having a health plan is the greatest need of the hour. However, just like knowing the process of buying a policy, one should also know the process of canceling a health insurance policy. Let’s learn the process in this post.

In medical emergencies, Health insurance plans Keep the user upfront about the costs of the treatment. While having a health insurance policy is essential, it is equally important for every policyholder to know all the details of the policy. In this post, we will discuss information on how to cancel an insurance policy and the formalities related to pre and post cancellation policies. However, it is important to confirm that you really want to cancel the policy and why.

Evaluate everything before canceling the insurance policy

An insurance policyholder can cancel his policy at any time during the policy period. Also, the policyholder does not need to wait till the end of the waiting period to cancel the insurance policy. However, the amount of refund received by the insurer for the canceled policy depends on the time of cancellation of the policy.

Although canceling an insurance policy is not difficult, there are many things to evaluate and consider before taking the step. Family medical history, savings in hand and number of dependents should be ascertained. Because the huge inflation in the medical sector has made even basic medical treatments very expensive these days. So, if you are the bread earner in the family, it is very important to be covered regularly under a family floater health insurance policy. So, it is very important to consider all such things before canceling the policy.

Let us discuss some of the important things that a policyholder needs to consider before purchasing a health insurance plan.

Important points to consider before canceling your health insurance policy

Below are some questions that the policyholder should try to find answers to before taking the policy cancellation decision.

1. Reason for cancellation of health insurance policy – The first important thing is to consider the underlying reason for canceling the insurance policy. This question is also important because the policy cancellation depends on your reasonable cause
2. Consider health insurance portability – If the policyholder is not satisfied with the terms of the policy, the insurer or the price of the policy, he/she can always change the plan through Health Insurance Portability.
3. Consider your savings – Due to inflation in the medical sector, even basic healthcare treatments have become expensive. Therefore, you can cancel the health plan only if you have enough savings to cover an unexpected medical situation
4. Any additional health policy – If you already have another health plan that covers your family, you can consider canceling a policy. But make sure everyone in the family has enough coverage
5. dependants – Another important thing to consider is the number of dependents you have. If you have minor children, spouse and dependent parents, think twice before canceling the insurance policy.
6. Withdrawal – It is also important to check the amount you can get after policy cancellation. If you are likely to receive a very small amount, it is better to continue the policy till the end of the policy period and not renew the plan. It will be canceled automatically

However, if you decide and are determined to cancel your health plan, below are the details related to health insurance policy cancellation to guide you better.

Cancellation of a policy during the free appearance period

Free-look period is a period of more than 15 days (from the policy inception date) allowed in every insurance policy. At this point, the policyholder can plan to cancel the policy and get the full premium amount back. The free look period allows the insurer to think over the policy terms and conditions and continue or cancel it as per consideration.

Deduction in amount refunded

The amount refunded may include deductions such as:

• Stamp duty and administrative charges
• Expenses incurred by insurance company on medical examination
• Prorated risk premium for the insured period

Cancellation of a policy after the free look period

In some cases, the policyholder may miss canceling the policy during the 15 days free look period and may wish to cancel the policy after the expiry of the period. In that case, the policyholder will not be entitled to claim 100% compensation of the premium amount from the insurer.

Here, the deductions in the refund amount include:

Duration	deduction
Within 1 month	The policyholder is entitled to 75% of the premium paid
Within 3 months	The policyholder is entitled to 50% of the premium paid
Within 6 months	The policyholder is entitled to 25% of the premium paid
After 6 months	Since the insurer does not have to pay anything after 6 months of the policy, the policyholder does not get any amount.

How to cancel health insurance policy

Health insurance policy cancellation can be done in the following simple steps:

• Request for Cancellation – If the policyholder feels that the policy purchased by him does not meet his exact requirements or he/she is not satisfied with the health insurance terms and conditions, he/she can write an application to the insurer to cancel the individual insurance policy. Once your claim reaches the insurer, you may be asked to fill certain forms and documents by the insurer.
• Procedure for Cancellation – To process the cancellation request, the insurer will contact the policyholder to obtain further details. The insurer may want to know the reason for cancellation of the policy, other documents etc. They may also recommend an alternative policy or solution to your problem. If your reason for policy cancellation is valid, the claim will be processed and refund will be initiated.

read more: What is the Free Look Period in a Health Insurance Policy?

In total

Canceling an insurance policy is a hassle-free process. However, it is very important to consider all the above-mentioned aspects before proceeding with the cancellation plan. Insurance is very important for everyone as it protects the policyholder from any financial turmoil due to medical emergencies.

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