What does policy lapse mean? Will I have to purchase a new policy if the policy lapses? Let us have a look-
What Does Policy Lapse Mean?Your health policy is considered lapsed if you fail to pay the policy premium within the grace period. Once the policy lapses, you will no longer be covered under the policy. If any kind of medical cost arises after the health policy lapse, the insurance provider will not be responsible for paying the expenses.
As a matter of fact, you are not covered under the policy even during the grace period. So, your medical expenses will be paid by you even during the grace period.
What Happens When Policy Lapses?In most cases, you might want to revive your policy once it has lapsed. However, reviving a policy after it has lapsed comes with many consequences. For instance, if you had the policy for say 2-3 years and have not filed a single claim, you might have accumulated No Claim Bonus (NCB). However, as your health insurance lapses the grace period, you will lose the NCB if you want to revive the same.
Moreover, if your policy had a waiting period for a condition you are suffering from, you will have to serve this waiting period again. In other words, reviving a lapsed policy is very much similar to getting a new health policy and can require new medical checkups too.
When Can I Revive a Lapsed Policy?Most insurance providers allow you to revive a lapsed policy with six months from the date of policy expiry. But you will be required to pay health insurance lapse penalty for the same.
The penalty is charged in the form of interest which is calculated from the date when the policy expired and till the date when you decide to revive the policy. If this revival period is over too, you will be required to purchase a completely fresh health policy.
Pay Premiums on Time to Prevent Policy LapseOnce your health plan lapses, you will no longer be protected under the policy. Pay your premiums on time to avoid the trouble and make sure that your health remains protected at all times.
Learn more about differentHealth Insurance Planshere.
The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.
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