Waiting Period in Health Insurance

When you have health insurance, it's like waiting a bit before getting all the benefits. This delay is due to a mandatory waiting period in the insurance policy. While you might have heard about it, understanding how long this waiting period is and why it matters can be tricky.

In this article, we'll explain what the waiting period in health insurance means, explore its various types, and uncover some key points about it.

What is Waiting Period in Health Insurance?

A Waiting Period in Health Insurance is a set timeframe during which specific health conditions become eligible for coverage under your insurance policy. Often referred to as the cooling-off period, it kicks in from the start of the policy. For example, a common waiting period of 4 years for pre-existing conditions is included in many health insurance policies.

If a claim is submitted before this waiting period ends, the insurer may reject it. However, the insurance company cannot deny a claim once this waiting period ends. To simplify, if the waiting period for a particular condition is 90 days and you submit a claim within the first 60 days, it might be rejected. However, if you file a claim after 90 days, it should be accepted by the insurer.

What are the types of waiting periods?

Health insurance policies often have various waiting periods to manage coverage for different conditions and procedures. Here are the key types of waiting period in health insurance:
   

1. Pre-existing Diseases Waiting Period

When you sign up for health insurance with existing conditions like diabetes or high blood pressure, these are labelled as pre-existing diseases. Most insurance plans include coverage for these conditions, but a waiting period typically lasts 2 to 4 years. You can't claim expenses related to these declared ailments during this time. After patiently waiting out this period, you gain the full benefit of coverage for these pre-existing conditions.   

2. Waiting Periods for Specific Ailments

Certain illnesses and medical procedures, such as ENT disorders, hernia repairs, joint replacement surgeries, and cataract treatments, have specific waiting periods. This waiting period usually lasts one or two years. After completing the designated waiting period, you can only claim expenses for these specific conditions or procedures.    

3. Initial Waiting Period

Nearly all health insurance plans institute an initial waiting period of one month or 30 days. During this period, the insurance company accepts no claims except in accidents. It's a brief initial phase to ensure policy stability and prevent immediate claims, except for unexpected accidents.    

4. Critical Illnesses Waiting Period

Coverage for critical illnesses usually starts after a waiting period of 90 days. The insurer may reject your claim if you develop a critical illness within the first 90 days of your policy. However, once this waiting period is over, you can claim expenses related to critical illnesses.  

5. Maternity Benefit Waiting Period

Health insurance plans offering maternity benefits and coverage for newborns have a waiting period ranging from 9 months to 36 months. Understanding and planning for this waiting period is crucial if you plan to start or expand your family. It ensures that you have the coverage you need regarding maternity-related expenses.

Important Points Related to Health Insurance Waiting Period

Now that you know what is waiting period in health insurance, here are some important points worth considering: 

• If the insured is diagnosed with a disease for the first time during the waiting period, it won't be considered a pre-existing condition. The policy will cover expenses related to such newly diagnosed ailments.
• Many health insurance plans for senior citizens eliminate waiting periods by incorporating a co-pay clause. Co-pay means policyholders contribute a percentage of claim amounts while the insurance provider covers the remainder. For instance, with a 30% co-pay on a Rs 1 lakh claim, the policyholder pays Rs 30,000, and the insurer covers the rest.

Is it Possible to Reduce Waiting Period?

Reducing the waiting period in health insurance policy is possible, offering flexibility for quicker coverage. Here's how you can potentially minimize the waiting period:

• Waiting Period Waiver Option

Some insurance companies provide the option to reduce waiting periods through a waiting period waiver. This, however, involves an additional premium payment. For instance, specific health insurance plans feature a Pre-Existing Diseases (PED) waiver, cutting down the waiting period for such conditions from 4 to 2 years.   

• Group Health Plans Offered by Employers

In group health plans employers provide to employees, waiting periods are typically not insisted upon. Moreover, employees can transition from a group health plan to an individual plan, which may come without a waiting period. According to IRDA guidelines, employees exiting their employer's group health plan can convert it into an individual retail health policy. In such instances, individuals are granted a policy without a waiting period since they have already fulfilled the waiting time in the group health cover provided by their employers.

Why do health insurance plans have waiting periods?

The inclusion of waiting period in health insurance plans serves various important purposes:   

• Preventing Malpractices

Waiting periods act as a safeguard against potential malpractices by policyholders. With a waiting period, insurers encourage individuals to engage in genuine and long-term relationships with their insurance, discouraging any attempts to exploit coverage for immediate needs without a genuine commitment.    

• Managing Unforeseen Medical Risks

Waiting periods are a practical measure to protect insurers from unforeseen medical risks that might not have been anticipated during the initial underwriting process. This genuine precautionary step allows insurers to navigate the financial complexities of providing comprehensive coverage for various health conditions.    

• Avoiding Misuse for Regular Medical Expenses

Health insurance is a valuable resource meant to provide financial support for unexpected and high-cost medical events. Waiting periods are in place to ensure that policyholders use their insurance genuinely, avoiding any potential misuse for routine or regular medical expenses. This genuine approach helps maintain the integrity of the insurance system, allowing it to focus on authentic and significant healthcare needs.

Conclusion

In conclusion, understanding health insurance waiting periods is key to navigating your policy effectively. These brief pauses serve genuine purposes, from preventing misuse to managing unforeseen risks. Whether opting for waiting period waivers or transitioning from group to individual plans, these insights empower you to make informed choices.