What is a cancellation in Health Insurance?

Know More About Health Insurance Cancellation

Cancellation of health insurance is the end of a policy prior to its expiration date, either by the insured person or the insurer.

The best way to invest in your health is to buy health insurance. A health insurance benefit starts from hospitalisation expenses, no-claim bonus and continuity benefits.

What will happen to the premium during the cancellation of the health insurance policy? Before diving into the answer. Let us get information about the cancellation of the policy.

The health insurance policy can be cancelled from both ends. Either the insurance company or the policyholder can cancel the policy. It is essential to know about the cancellation processes. The policyholder has the liberty to cancel the policy at any time with prior notification.

What is policy cancellation in health insurance?

Let’s understand the insurance cancellation definition in health. Health insurance Policy cancellation is the way of terminating a health insurance plan and stopping the coverage.

What is a cancelable health policy?

A cancellable health policy is a policy that the insurer will be able to cancel at any time, even if the policyholder has been paying premiums on time.

Health insurance cancellation laws differ by state, but they hold some general guidelines. The medical insurance cancellation time period differs based on the type of policy and when the policy is cancelled.

How do I cancel a health insurance plan?

Initially, inform your health insurer’s support team about your desire to terminate the health insurance plan. 
Next, send your insurer a written policy cancellation request either offline or online. The written request should have policy details and the reason for cancellation of health insurance.

Types of Cancellation in Health Insurance

Cancellation in the free look period

Cancellation in the free look period is where the policyholder can cancel the policy within a free-look period of the policy mentioned in the policy document.

Most health insurance policies come with a free look period. The free look period is the time given to the policyholder to reflect on the policy terms and conditions and decide whether to continue the policy or cancel it.

Suppose the policyholder wishes to cancel the policy in the free look period. Then, 100% of the premium amount will be refunded. Some insurance companies reduce the premium for the expenses incurred for the medical screening at the time of inception of the policy.

The insurance company can also cancel the policy by the following conditions:

• The policy can be cancelled in the event of misrepresentation or non-disclosure of the material facts.
• If the policyholder indulges in fraud activities. 

Make the right choice while buying the policy. Take the time to understand the policy’s inclusion and other benefits. Go for a policy that has comprehensive coverage and benefits.

What happens if I cancel my health insurance policy?

If you cancel your health insurance policy, then you'll not be able to be covered for medical expenses after the cancellation date. You might be eligible for a refund of a few or all of your premium, based on your cancellation time and the time period for which you've been insured.

Summing up

Cancellation of the policy can be made both by the Insured and the Insurer. Reasons for cancellation can include nonpayment of premiums, fraud or changes in the policyholder’s health status, etc.

Cancellation of a policy can leave the policyholder without coverage, so it is important to understand the terms of the policy and the cancellation process.