Are all benefits lost if a health insurance policy lapses?

Failure to pay your health insurance premium on time can cause your policy to lapse, which affects your insurance coverage. However, a 'grace period' and the option to revive the policy can provide some relief.

If you have purchased a health insurance policy to protect your family, paying the premium on time is just as important as buying the policy itself. In today’s busy world, it is easy to overlook important dates—such as the policy renewal date. This often leads people to wonder: if a policy lapses, are all the existing benefits lost?

Missing the premium payment deadline does not necessarily mean that all your benefits are gone. It depends on whether your policy is currently within the 'grace period' or has lapsed completely.

What does it mean for a health insurance policy to lapse?

A lapsed health insurance policy means that your insurance coverage has ceased because the premium was not paid within the stipulated time or the applicable grace period. In other words, until the policy is revived, you cannot avail of the medical coverage it provides, and you may have to bear the cost of any medical treatment yourself. Therefore, it is crucial to keep track of your premium due dates.

Which benefits might be lost if a policy lapses?

Medical Coverage: Generally, you will not be covered for medical expenses incurred while your policy is in a lapsed state. It is, therefore, essential to check your policy status before getting admitted to a hospital.
No Claim Bonus (NCB): If you have earned a 'No Claim Bonus' by not filing any claims in previous years, a policy lapse could negatively impact this bonus. However, this depends on the terms and conditions of the policy and the rules for its reinstatement.
Waiting period: The waiting period already completed for pre-existing illnesses or specific treatments does not necessarily reset in every case. Rules may differ if a policy lapses and a new one is purchased.
Continuity benefits: Certain benefits accrued from maintaining a continuous policy may be affected. Therefore, it is essential to renew the policy on time.