Picture this: You have been meaning to buy a health insurance policy for yourself but kept putting it off for some reason. Now, the new COVID-19 wave strikes once again and the infection positivity rate shoots up in a flash.
Just as you buy your health insurance in a state of panic, you happen to contract COVID-19 and need to be hospitalised . You take a breather thinking that at least your expenses will be covered, but your insurer tells you that you haven’t passed the waiting period as per your policy yet. Perplexed? Given the kind of caseload that India is reporting on a daily basis, this could actually be the story of anyone around you.
The past two years have firmly established the need for a health insurance policy. However, just purchasing a policy is not enough. Considering the aftermath of the past two waves we have witnessed, we ought to be better prepared this time by knowing the policy inside out. One of the most important conditions of your health plan is the waiting period, and this has become all the more important during COVID times. Let’s dive deeper to understand how the waiting period works - especially in the time of COVID - and how it impacts your coverage.
What is waiting period?
Frequently Asked Questions
A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.
There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine.
Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.
The waiting period refers to a fixed period of time that the policyholder should serve after buying the policy before the actual coverage starts. The waiting period had always been applied to health insurance long before even the pandemic broke out. Typically, all insurers had waiting period in place for pre-existing conditions which ranged anywhere from 2-4 years. These conditions could be diabetes, hypertension, kidney-related ailments or any other disease for which you are on continued medication. Similarly, all policies have a wait period of 30 days for all claims except accidents. This is done to avoid anti-selection, i.e., somebody who knows that they would need hospitalization in the next few days may buy a policy for the claim. Avoiding anti-selection helps keep the price down for health insurance.
The COVID-19 outbreak has made it even more important that policyholders know and understand the waiting period in their policy or they’ll end up paying out of their pocket despite having health insurance. Essentially, waiting period is meant to shield the interest of the insurers against any fraud, collusion or misuse of insurance by any policyholder.
Duration of a waiting period
The duration of a waiting period varies from policy to policy or insurer to insurer. However, to help policyholders during the hour of need, insurance companies are coming up with low waiting periods. Most plans cover all illnesses including COVID-19 and excluding accidents after 30 days.
However, the third wave is bringing about a rapid surge in cases. In the context of COVID, insurers have brought down the waiting period to as low as 7-15 days. For instance, Digit General Insurance’s health insurance plans offers the lowest waiting period of 7 days for COVID coverage. This means that one can file a claim for hospitalisation due to COVID 7 days after the policy issuance. At a time when the infection rate continues to soar, it greatly helps to have a plan with a low waiting period like this.
Beyond COVID: Waiting period exceptions
As we have witnessed in the past, COVID can cause other health complications and lead to hospitalisation. They could be heart, liver or kidney-related ailments. So, you also need to factor in the waiting period for these as well before finalising your policy. In case you feel your waiting period is too high, you can reduce it by paying a little extra under select plans by opting for a waiting period waiver.
Apart from that, a fresh waiting period also applies in case you decide to enhance your sum assured at the time of renewal. Suppose you had an existing cover of Rs 10 lakh and opted for an additional Rs 5 lakh while renewing your policy. You’ll have to serve a fresh waiting period for the additional amount. You can, however, avail Rs 10 lakh without any waiting period. Similarly, if you need to port your policy, you can do so easily if you have served the waiting period of your current insurer. If not, you will have to serve it with your new insurer.No matter what type of plan you choose, don’t forget to check all the details from your insurer. In case you don’t understand any term related to your waiting period, always double-check and then make an informed decision.