Group health insurance provides coverage to a group of individuals under a single policy. It is usually provided to the employees of organizations as an employee benefit. The family members of the employees can also be included in a group health insurance policy. It is the employer’s responsibility to renew the group health insurance policy before the end of the policy term.
Group health insurance renewal can either be an annual affair or after every 2-3 years in the case of multi-year policies. Failure to renew the policy results in its lapse. Policy lapse leads to an interruption in coverage because a fresh policy needs to be purchased. The cumulative no claim bonus is lost, and the waiting period restarts. Thus, it is necessary to renew your group health insurance policy at least ten days before its expiry date.
Points to Consider Before Group Health Insurance Renewal
Check for Any Changes in The Terms and Conditions of Your Policy
As per IRDAI, changes in terms and conditions of a policy cannot be made at the time of renewal. If the insurer wants to make changes to the terms and conditions of any particular policy, the same has to be approved by the regulator. It must be communicated to the policyholder three months before the renewal date.
However, it is advised to look for changes made to the terms and conditions during group health insurance renewal to ensure that the insurer is adhering to the IRDAI guidelines. In case the changes made to the terms and conditions of your policy were communicated by the insurer within the time frame specified by the regulator, and you are not agreeable to the changes, you can switch over to a new policy with the existing or a new insurer.
Analyze Your Health Insurance Requirements
The health insurance requirements of the members covered under the policy need to be reviewed and analyzed at the time of group health insurance renewal. You need to decide whether to increase the scope of coverage, such as adding critical illness cover, maternity benefits, domiciliary hospitalization, or other benefits to the policy or not, depending upon the average age of the members and their general health.
Members can also be added or removed at the group health insurance policy renewal. You can also decide whether to add the family members of the employees to the policy if they are not already covered.
Option to Increase the Sum Insured
The sum insured can be increased at the time of group health insurance renewal except when the sum insured is the maximum allowed under that particular policy. The medical inflation rate and current health insurance requirements must be considered to decide on whether to increase the sum insured or not.
It must be remembered that the insurer can impose conditions such as no claim history or an additional waiting period in order to increase the sum insured. An alternative to increasing the sum insured, especially when the policy has reached its maximum sum insured, is a top-up plan. A top-up plan adds an extra amount to the sum insured. It covers the additional claim amount if the treatment expenses cross the sum insured. However, there is always a deductible limit that must be breached to activate the top-up plan.
Disclosure of Any New Illness to The Insurance Company
The health condition of any member covered under a group health insurance policy can change during a policy term. Even though an insurance company cannot impose new conditions at the time of renewal, it can ask for new documents about the members’ health status covered under the group policy.
Concealing adverse health conditions from the insurance company can create problems at the time of making claims. It is advisable to provide the correct details of the latest health conditions of the covered members during group health insurance renewal. Information about any new illness developed by any member of the policy must be communicated to the insurance company.
Updated Documents Need to Be Kept Ready
The correct documents need to be prepared before group health insurance renewal. These include the existing policy document, renewal notice, medical histories of the members covered under the policy, identify proofs, address proofs, and age proofs. The insurance company can also ask for any other document as per its rules. Most insurance companies provide the facility of submitting the documents digitally, thereby eliminating the need to visit the insurance company’s office physically.
Consider the Option of Portability
IRDAI gives the right to policyholders to port their policies to other insurers of their choice. Thus, if you are not satisfied with the services and coverage of your current group health insurance provider, you can port your policy to another health insurance company of your choice at the time of group health insurance renewal. Porting can be done without loss in benefits such as a new waiting period for pre-existing diseases, a drop in the sum insured, and more.
It must be remembered that porting your group health insurance policy is not possible before renewal. Thus, you cannot port your policy during the policy term. Moreover, you must intimate your existing group health insurance provider about your intention to port your policy at least 45 days before the date of expiry of your policy.
Renew the Policy on Time
Group health insurance renewal should be completed much before the due date. Insurance companies send renewal notices long before the due dates. It is better to renew the policy as soon as the renewal notice is received.
Insurance companies provide a grace period of 15-30 days after the due date to renew the policy. The policy lapses at the end of the grace period.
Group health insurance renewal is as important as properly purchasing the policy. Keep the above-mentioned points in mind to avoid problems during renewal.