What Is a Health Insurance Plan Grace Period?

Health insurance plans need to be renewed every year. In some cases, your policy will automatically renew, but there are times when you will have to renew it on your own by speaking with your health insurance company. If you’re in this situation, and you fail to renew your health insurance policy before it expires, your insurer will usually give you more time, or a grace period, so that you can renew your plan. But once this grace period passes, your health insurance will be terminated, leaving you uninsured.

How Long Is the Grace Period?

calendar with a clock next to it
Typically the grace period for health insurance renewal will be anywhere from 15 to 30 days after your policy’s expiration.

The grace period that your insurance company offers can vary, but typically the grace period for health insurance renewal will be anywhere from 15 to 30 days after your policy’s expiration,  depending on the insurance company and the type of policy that you have. It’s important to note that your health insurance company isn’t required to offer you a grace period. If they do offer one, though, and you fail to pay your premium within this time, your policy will expire, and you will lose all the benefits and privileges you have earned over time. 

What Happens If You Miss Your Grace Period?

One of the biggest drawbacks of ignoring your grace period is that you will end up without health insurance coverage, which can be very dangerous. If you fall sick or have a medical emergency in this case, you will have to pay for any treatment completely out-of-pocket, which could be thousands of dollars. 

If you do let your policy lapse, you can purchase another one, but you might have to wait until Open Enrollment, and then you will have to wait for the plan to go into effect once you purchase it. There are other benefits that you will lose if you fail to renew your policy, including:

  • No-claim bonus– A no-claim bonus is a feature that some health insurance policies offer as an incentive for policyholders who do not make any claims throughout the year. Your insurer might give you a cumulative bonus, or a discount on your premium if you go a year without making a health insurance claim. These cumulative bonuses could mean that your coverage amount for the next year will increase, while your premium will remain the same.
  • A cheaper policy- The policy that you currently have will most likely be cheaper than a new policy. A new policy will cost you more because health insurance costs are on the rise; not only that, but you will be another year older when you apply for a new policy, which will generally mean paying higher premiums.hourglass with sand in it
  • No waiting periods for coverage of pre-existing conditions – Insurance companies can no longer deny you coverage for pre-existing conditions, but they can still have what’s called a pre-existing condition exclusion period. This means that they can limit or exclude benefits for a certain period of time, meaning some newly-purchased health insurance plans can have up to a 24 to 48-month waiting period for coverage for some pre-existing conditions. If your health insurance lapses, and you need to buy a new policy, your waiting period will restart from the beginning.

Looking For An Affordable Plan?

If you have missed your insurance plan’s grace period, and you are uninsured, come to EZ.  With our help, you can find an affordable plan: we offer a wide range of health insurance plans from top-rated insurance companies in every state. And because we work with so many companies and can offer all of the plans available in your area, we can find you a plan that saves you a lot of money – even hundreds of dollars – even if you don’t qualify for a subsidy. There is no obligation, or hassle, just free quotes on all available plans in your area. To get free instant quotes, simply enter your zip code in the bar above, or to speak to a local agent, call 888-350-1890.

Understanding Life Insurance Clauses

How often do you sit down and read the fine print before buying or agreeing to something? Far too often, consumers make big purchases or enter into contracts without reading what they’re getting into – and purchasing a life insurance policy is often no different. But when it comes to purchasing life insurance to protect your family, there will be clauses in your policy that you need to pay attention to and read carefully: these clauses are important, and the more you know, the better the decision you can make when purchasing your policy, or when you need to make a claim.

Contestability Period

First, it is important to understand what is known as the contestability period of your policy. This is a period of time, typically one to two years after you purchase your policy, during which your life insurance company has the right to review any claims made after your death. If the circumstances of your death are suspicious to them, or if your insurer suspects that you had an undisclosed medical condition, they have the right to investigate, and possibly reduce your beneficiary’s payout, or even deny their claim altogether.

Common Life Insurance Clauses

All life insurance policies generally have one or more clauses or exclusions written into them. The clauses are meant to help protect you: the whole point of them is to make sure that your policy’s contract is carried out in a fair manner. 

Some common life insurance clauses and exclusions include:

illustration of a calendar

  • Freelook period–  This allows you to cancel your policy and get a full refund within a specific period of time, typically 30 days.
  • Grace period–  If you miss a premium payment, you w
  • ill generally have a grace period, meaning your policy will remain active for a certain period, usually 31 days, giving you a chance to pay your premium before the policy is canceled.
  • Spendthrift clause- If the person you named as your beneficiary is in debt, this clause will protect the policy payout from being claimed by creditors, allowing the beneficiary to receive the full payment.
  • Misstatement of age clause-  If you lie about your age during the application process, your insurer can raise your premiums, adjust the benefit amount, or decide to terminate your policy altogether.
  • Entire contract clause- If you make any false statements on your application, your insurance company has the right to terminate the contract and deny any payouts to your beneficiary.
  • Suicide clause- The substance of this clause can differ among different life insurance companies, but typically having a suicide clause in your policy means that your insurer will not pay out any claims if you die by suicide within a specific period after purchasing the policy – typically two years.
  • Reinstatement clause- If your policy ends up getting terminated because you have fallen behind on payments, you can reactivate it by paying all of the premiums that you have missed plus interest. 

Do You Still Have Questions?

question mark faded with 4 question marks in front of it
If you still have questions, an experienced life insurance agent can help you.

There is a lot to understand about life insurance policies and all of the rules surrounding them, but speaking to an agent can help make the process easier. A licensed agent from a top-rated insurance company can also help you find the best policy for you: they can help you find an insurer with affordable rates, and give you ideas for how to cut down on costs, as well explain all the ins and outs of each policy. 

We have listed some companies to work with that will be able to find you the most coverage for less. Always check multiple sites to make sure you have bargaining power and to know the advantages of each company. Make sure a hard time for your loved ones isn’t made harder by a financial burden, check life insurance rates today.