Purchasing a health insurance plan can often be hindered by the upfront cost of the premium, leading many individuals to prioritize other expenses over protecting their health and that of their families. However, the landscape is changing, with an increasing number of insurers offering the option to pay health insurance premiums in installments. This approach can alleviate financial strains and make health insurance more accessible, especially for those facing budget constraints.
HDFC ERGO General Insurance’s President of Retail Business, Parthanil Ghosh, highlighted the significance of this initiative, stating, “Instalment option to pay the health insurance premium is targeted to such customers, who don’t have to postpone their plans of taking up a health insurance for lack of funds.” Many insurers provide installment options on a half-yearly, quarterly, and even monthly basis without any additional interest charges.
While the demand for EMI payment is growing, paying health insurance premiums in installments is still a relatively new concept. Ghosh noted that since its launch in October 2022, about 30% of Optima Secure’s online customers have opted for the installment option.
It’s important to differentiate between the installment option offered by insurers and third-party payment platforms that facilitate EMI payments using credit cards. The latter remit the full payment to the insurer and retrieve the amount in equal installments from the customer, often with added interest.
However, the question of claim procedures arises. In case of a claim before the completion of premium installments, customers can initiate a regular claim process, whether cashless or reimbursement. The outstanding premium installment due for the policy year will then be deducted from the total claim payout.
It’s essential to be aware of the grace period for late payments to prevent policy lapse and the loss of continuous benefits. For instance, HDFC ERGO Optima Secure offers a 15-day grace period for monthly installments and a 30-day grace period for quarterly and half-yearly installments. If payments are not made within the allowed grace period, the policy may be canceled.
The availability of installment-based premium payment options for health insurance plans marks a positive step towards making health coverage more accessible and manageable for a wider range of individuals, ensuring that financial constraints do not hinder their ability to prioritize their health and well-being.
