HOW TO CANCEL HEALTH INSURANCE POLICY?

livewell
March 29, 2024
Eric kent

Introduction

Everyone must have health insurance. Health insurance saves you money and helps you in emergencies. Whenever you experience an unexpected accident, health insurance will provide you with financial support.

Health insurance should be a part of an individual’s financial planning. It covers medical bills. However, some people want to cancel their health insurance policy but do not know how to. This blog discusses the cancellation of the insurance policy. It will also explain the steps involved in the process.

Is It Possible To Cancel Health Insurance Policy At Any Time?

Health insurance can be individual or family. You can cancel your health insurance easily if your health insurance is self-only. You can also cancel your health insurance even if it is a family health insurance.

Cancellation of health insurance depends on the insurance plans and company you are associated with. Insurance companies have different policies and procedures for health insurance. Some will allow cancellation of the health insurance policy at any time while others may not.

Open enrollment

There is a time in a year called open enrollment when you can make changes in your health insurance. You can end or enrol in a new health insurance policy during this time. You can also choose family coverage through individual health insurance.

There is a specific time and eligibility for open enrollment. You can cancel your health policy once you are eligible for the special enrollment period. This period is open for 60 days. If a person misses the window, he has to wait until the next open enrollment time. It is crucial to keep checking the enrollment time of your insurance company. But, if you cancel your health policy outside the enrollment time of the company, you must experience a qualifying life event.

Qualifying life event

Sometimes, it is difficult to cancel an insurance plan, especially when you have group health insurance. However, when you have a qualifying life event, cancellation of health insurance is easy. You can cancel your health insurance when you experience a qualifying life event. You can also get a new plan even when there is no open enrollment period. The qualifying life events include:

When you are having a baby
Divorce
Marketplace enrollment plan
Child Adoption
Marriage
When you are eligible for Medicaid or Medicare
Major changes to coverage

Special enrollment periods are mandatory for life status changes, while optional ones allow employers to decide if employees can waive coverage or change plans.

How To Request The Cancellation Of My Insurance?

Requesting your health insurance company to cancel your plan is easy. When you sign up for the health insurance plan, you first create an account and log in. You can see all the details and plan coverage of the insurance online.

You can contact your company and request them to cancel your health insurance plan. The contact number and email addresses are available as well. This makes it easy for you to contact your company and request them to cancel your health insurance.

Steps To Cancel Health Insurance Plan

Follow these simple steps to cancel your health insurance plan.

Contact your company and request for cancellation

Contact your company and request them to cancel your health insurance plan. Your online portal will help you out with this. Your online account will contain all the details of your company including their email address and contact number. Log in to your account and contact your company.

Companies usually provide online services. Calling their customer services, and requesting them to terminate your insurance plan is also a good option. You can terminate your health insurance the phone. You may need to send them additional documents through mail or fax.

State your request clearly

It is vital to state your reasons clearly for cancelling your health insurance. Send your insurer a well-written cancellation request. You can send it online or offline.

Your request to the company should include all the policy details. State your insurance plan and valid reasons for terminating it.

Follow the procedures set by your company

Different insurance companies have different policies and procedures. They have different plans and benefits according to your insurance plan. For instance, if you have Medicare Advantage plan A, it will provide you with hospital coverage. If you have plan B then you will get medical coverage.

Every health insurance company have some rules and procedures for cancelling the health insurance plan. All the procedures are crucial to follow. For example, for some insurance companies, it is vital to confirm the policy’s end date. You must write these dates correctly to avoid any coverage gap

Follow and complete all the steps of the cancellation process of the company. You can cancel your health insurance once you complete the steps. Once you complete the process, the insurance representative will check and confirm. The insurance representative will send you a code that is essential to note.

Check for the premium refund

After requesting and applying for the cancellation of the health insurance, ask your company if you can get a refund. You will be compensated if you have an individual policy and paid in full for a whole year.

Your insurance company may return the remaining premium payments. Mostly, health insurance companies refund the remaining monthly payments. Review your bank statements regularly to make sure the terminated plan is no longer in effect. In addition, you must ensure that your new policy is active and running under previous amounts.

Check your active health coverage regularly

It is recommended not to cancel your previous plan before securing the new policy. You should secure a new health policy and then terminate the previous plan. Additionally, you cannot submit a claim to two different medical plans if your active coverage periods overlap. You can only have one health insurance advantage and must designate one policy as primary insurance.

Checking your monthly health allowance is another crucial thing when your employer is reimbursing your health insurance. An employer usually reimburses your insurance premium with a health stipend or health reimbursement arrangement.

Health reimbursement arrangement

Health reimbursement arrangement (HRA) is one of the ways employer covers your medical bills. You must know how much you are getting from your employer before purchasing the policy. Furthermore, check whether your employer is offering individual coverage, integrated or qualified small employer HRA because all these types have different reimbursement policies.

Cancellation law awareness

Consumer protection laws can also help you to cancel your health plan. Insurance regulators and laws will help you with the questions regarding health insurance cancellation. However, each state has different laws and regulations.

Some states cover all health coverage, medical care providers and access to medical specialists. There are a few states that offer insurance policies covering specific medical services and treatments while others do not. It is crucial to be aware of these protection laws to have access to health services. You must know if the laws apply to all insurance plans.

Does Putting False Information Can Cancel My Health Insurance?

Filling the correct information on your application is essential. If you put any false information in your application your employer will cancel your request and policy. However, according to cancellation law, an employer cannot cancel your coverage if it was an honest mistake.

Moreover, make sure to clear all overdue premiums because if you have any, the insurer will end your medical coverage. The company will give you notice and time to correct your mistakes before cancelling the plan.

Is There Any Penalty For Cancellation Of Insurance?

The penalty for cancelling health insurance depends on the state you live in and the type of health insurance plan you have. Different types of insurance like travel, home or car insurance have different laws. Every state has its laws and regulations on cancellation of health insurance.

In many states, there is no fine for ending your health insurance. Whereas some states charge a fine for terminating the health insurance plan.

How To Avoid Penalty Of Cancellation Of Health Insurance

Cancel your health insurance within the open enrollment period to avoid any charges. You can also end your health insurance before the deadline of the health plan. Your insurer may charge a penalty if you cannot terminate your policy before its end. To avoid this, inform your insurance representative in advance or before the policy’s effective date.

You have to wait until the insurance renewal date if you want to avoid the cancellation penalty. However, sometimes waiting for your company’s policy renewal date is not beneficial. In addition, if a person is purchasing a health insurance plan through the Affordable Care Act, without having a qualifying life event, he may get charged.

Affordable Care Act

Affordable Care Act (ACA) is a law that helps to cover maximum health insurance coverage. This law is implemented if there is a need to bring reforms in the health insurance market. ACA helps to improve the market of health insurance policies.

Cancellation Of Health Insurance And Refund Process

You might wonder if you are cancelling your health insurance, can you get a refund? Yes, there is a refund. First of all, cancel your health insurance within the free look period. This is a time frame where you can end your health insurance policy. The period ranges between 15 to 30 days.

Online policies have 15 days whereas Offline policies typically have a 30 days free look period. Cancellations within this period can result in a 100% refund. However, if you do not terminate your health policy within this time frame, you might get a penalty.

Deductions amount

Cancelling your health insurance within the free look period leads to a 100 per cent refund but in reality, it is not. Cancelling your plan even within the free look period can cost you. There will be deductions associated with this.

Different types of deductions are there depending on the insurance company and state you are living in. Some considered deductions are:

Your health insurance company will deduct the amount that is paid for your pre-policy medical examination.
Administration charges
Stamp duty
Other charges mentioned in the wording of the policy

Refund process

The refund process can be easy and complicated. Again it depends on the type of health policy and the state. Different states have different rules and regulations for refunds. Companies usually look for the eligibility criteria of a person for a refund. You are eligible for a refund if you have cancelled your health insurance within the allowance period.

The refund process has simple steps that include:

First, check for your eligibility for the refund process
Then contact your health insurance company. You can contact them over a call or through an online portal.
Provide all the information needed. Make sure to provide details like reasons for cancellation and correct information.
Your insurance company will receive your request and process it. After processing, it will assess and issue your refund amount.
Finally, your company will notify you and deposit the refund.

Review your documents and provide information carefully. Do not forget to check the eligibility criteria and the regulations of your company.

When I Need To Cancel My Health Insurance?

The cost of medical services is escalating. Everyone needs health insurance as it covers their medical bills. It is useful in emergencies. However, there are times when people feel like cancelling their health insurance. You may need to cancel your health insurance for many reasons like:

To get a better plan

Sometimes you find a better health insurance plan after you already purchased an insurance plan. Your existing plan may not cover enough for your medical bills but the other plan will. In such a case, you need to cancel your health insurance and select a better plan.

Insufficient medical coverage

Many insurance companies manipulate people stating they cover all the medical bills but in reality, they do not. If your health insurance is not sufficient enough to cover your medical bills and other requirements, you should not continue your health journey with that company.

Unexpected costs

It is possible to experience some differences in cost. Your health insurance companies may have some hidden charges that you did not know about. Unexpected and hidden costs can be a burden to your wallet and create problems. Cancelling your plan will be wise in such cases.

Medicare eligibility

Medicare is one of the effective health insurance that offers several benefits to citizens who are older than 65 years. The advantages of Medicare are several and that is why many people prefer Medicare to other health insurance. You need to cancel your health insurance if you are eligible for Medicare to access many health benefits.

Financial problems

One of the worst problems that you might face in your life is financial problems. If you are experiencing financial issues and cannot bear the health insurance’s expenses, it is better to cancel your plan.

Bottom Line

Cancelling your health insurance plan is easy with some simple steps. You can cancel your health insurance online as well, which is the easiest way. You can cancel it anytime. However, if you have cancelled your plan and there is a remaining amount you cannot get a refund. You must cancel your health insurance plan within the allowance period to get the refund. In addition, to ensure continuity of health services, qualify for a special enrollment period before cancelling medical care.

FAQ

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Is it easy to cancel my health insurance plan?

Yes, it is easy to cancel your health insurance. You can even cancel your plan through an online portal. You just need to provide your plan details and state the reasons for cancellation of the plan.

Can I get a refund after cancelling my health insurance plan?

You can get a refund when you cancel your health insurance plan within the allowance period. Send an email with all the details of the cancellation to your insurer. You will get a refund after a few weeks.

Are there any deductions in the refund?

Yes, there are some deductions imposed by the companies. Although they claim to do a full refund, they deduct some amount. The deductions vary from company to company.

Does school-related stress affect physical health?

Stress can affect your physical health as well. It significantly impacts your body and organs including the nervous, gastrointestinal and immune systems. Your mental health is directly associated with your physical health.

When is the right time to cancel my health insurance plan?

It is better to cancel your health insurance during open enrollment so that you can enrol and purchase a new health plan for your medical care.

How long will it take to cancel my health insurance?

Cancellation of your health insurance takes a week. It can also take more than one week to process your details and information provided. You must fill in the correct information if you want a quick response from your company.