What is Break in Policy in Health Insurance?

Health insurance is meant to be your financial safety net during medical emergencies. But what happens if you miss your policy renewal date? Or even miss the grace period? That’s where the concept of a Break in Policy comes in, and it’s an important concept in health insurance that every policyholder should know about.

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Break in Policy in Health Insurance

A break in policy occurs when your health insurance policy is not renewed on time and lapses or expires. In simple terms, there’s a period where you’re not covered, and this can have serious financial and formal consequences.

Insurance companies in India typically offer a grace period of 15 to 30 days after the policy’s expiry date to make the payment. If the premium is not paid within this grace period, the policy is considered “break-in” or lapsed.

Why it matters

Loss of coverage: You are not insured during the break period, which means no claims will be entertained if something happens.
Loss of waiting period benefits: If your policy lapses for too long, the waiting periods for pre-existing conditions, maternity benefits, etc., might start from scratch.
No claim bonus (NCB) loss: Years of claim-free benefits can be wiped out if there is a break in policy.
Fresh medical underwriting: Insurance companies may ask for fresh medical tests if you reapply after a long break.
Higher premiums or rejection: You might be charged a higher premium or even denied coverage, especially if your health has changed.
Policy portability gets affected: You cannot port your health insurance to another insurer if there’s a break in policy. Portability is only allowed for continuous policies.
Legal setbacks: As per IRDAI guidelines, insurance companies are not legally required to renew your policy after the grace period ends. This makes it harder to restore your original plan.

Can You Revive a Lapsed Policy?

You can usually revive or restore a lapsed policy, but it really depends on how long the policy has been inactive.

If it’s just been a few days or weeks, most insurance companies will let you renew your policy by simply paying the premium. They might also charge a small late fee.

If it’s been over a month, things can get a little complicated. You might need to reapply as a new customer, and go through medical checks again, and there’s a high chance you will lose benefits like your no-claim bonus.

Conclusion

A break in policy happens when you miss your health insurance renewal date even after the grace period. It might seem like a small thing, but it can turn into a big headache. It’s not just about being not insured for a while, you could lose benefits you’ve built up over the years, like your no-claim bonus or waiting period credits. That’s why it’s so important to renew your policy on time. And if you do miss it you should ideally act fast. Restoring it during the grace period can save you a lot of trouble.

Frequently Asked Questions

Am I covered during the grace period?

Not typically. Most insurance companies do not honour any claims during the grace period. It is only offered to policyholders as an extension to make payments and not claims.

Can I switch insurance companies after a break in policy?

Yes. You can switch insurance companies, but you will be treated as a new applicant, and any policy portability benefits will not apply.

Is there a penalty for renewing late?

Yes. Some insurance companies might charge you a late fee or even require you to get a new medical check-up done.

Will my insurer remind me about a break in policy?

Yes. Most insurance companies will send you a reminder via SMS, email, phone calls, or on their mobile app.

Will my sum insured also change with a break in policy?

Yes. If the break is long enough, it will be treated as a new policy, your sum insured and any accumulated bonuses, like no-claim bonuses, might be reset.

Can I still make a claim if my policy expired yesterday?

No. If your policy lapses or expires even by a day, your coverage will stop immediately, and any medical expenses will not be reimbursed by the insurance company.

Written by Roocha Kanade

2.5K Linkedin Followers

Reviewed by Dr. Harshita Dahiya

Health Insurance content enthusiast who turns complex topics into easy, binge-worthy reads—fueled by SEO, creativity, and way too much chai! Loves juggling multiple projects, cracking impossible deadlines, and sprinkling humor into the mix. When not geeking out over digital trends, you'll find her lurking on Quora and Reddit, planning the next getaway, or passionately decoding all things health and insurance!