The option to pay our health insurance premiums on a monthly, quarterly or half-yearly basis in addition to the current option of paying premiums on an annual basis is now made available
Till recently, health insurance policy premiums were only payable on annual basis unlike premiums for life insurance policies. Kapil Mehta, a Delhi-based Insurance broker, said, “At the time of purchasing the policy if you opt for the monthly premium payment option, the free look period provided to you will be shorter than that in the annual payment option.”
As per the circular issued by regulator (Insurance Regulatory and Development Authority) IRDAI dated September 20, 2019, “The premium mode (frequency) proposed to be added may be monthly, quarterly or half-yearly and the resulting premium amounts under each mode (frequency) are consistent with premium amounts under other premium modes (frequencies) of the underlying product.”
In the revised terms an insurer has to process the claim even if an insured bought health insurance with monthly premium paying mode, paid only two months premium, and filed an insurance claim for reimbursement. However, in such a case, the insured has to either pay the remaining premium in one go or the insurer can deduct the remaining premium from the total claim amount payable.
However, IRDA had allowed the insurers to marginally increase the total premium amount if the policyholder opts for a quarterly/month premium payment option as compared to the annual premium payment option. But the basic premium will not be changed(it depends on policyholders age) if the payment is made in monthly installments. This increase in premium can vary on a plan to plan basis.
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