10 must-know rule changes to unlock the full potential of your insurance plan

The insurance industry is transforming to meet the evolving needs of policyholders. These changes are designed to provide better flexibility, transparency, and ease for customers, making it simpler to manage policies and maximize benefits. Whether you’re a new buyer or a long-time policyholder, staying informed about the latest updates can help you make the most of your insurance plan.

In this article, we’ll explore the 10 most significant changes that are reshaping the way insurance policies work. From shorter waiting periods to better portability options, here’s everything you need to know to ensure you’re getting the best coverage possible.

1. Shorter Waiting Period for Pre-Existing Diseases (PED)

Pre-existing disease coverage is one of the most crucial aspects of any health insurance policy. “To benefit customers, the waiting period for pre-existing diseases has been reduced from 48 months to 36 months. This means you can now access benefits for your pre-existing conditions a full year earlier than before. The best part? This change is applicable across all products and variants, even for customers with running policies,” says Venkatesh Naidu, CEO, Bajaj Capital Insurance Broking Ltd.

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2. Mandatory Nomination Confirmation at Renewal

When renewing your policy, it’s now a requirement to confirm your nomination details. “While this might seem like a small change, it’s crucial. Having the correct nominee ensures that in the event of your passing, the policy benefits will go to the person you intended, without delays caused by documentation issues,” says Naidu.

3. Bank Account Details Now Required at Policy Logging

To streamline financial transactions, including premium payments and claim settlements, insurers now require the proposer’s bank account details at the time of policy logging. This makes it easier to ensure that any payouts are processed quickly and efficiently.

4. Extended Free Look Period: 30 Days to Decide

The free look period, which allows you to review the terms and conditions of your policy and make changes if necessary, has been increased from 15 days to 30 days. This gives customers more time to thoroughly review the policy and make an informed decision.

5. Grace Period Extended for Monthly Payments

A grace period of 30 days now applies for all types of policies. For those with monthly premium payment modes, the grace period is 15 days. Importantly, your policy coverage remains active during this grace period.

6. Pro-Rata Refund for Policy Cancellation

Previously, if you cancelled your policy after the free look period, the refund was based on a short-period grid. This has now been replaced with a more equitable pro-rata refund system.

7. Customer Information Sheet for Group Policies

For those enrolled in group insurance policies, a detailed Customer Information Sheet will now be provided to the master policyholder after the proposal form is signed. This document will include the full details of benefits, terms, and conditions of the policy.

8. Customer Consent for Data Sharing

At the time of enrolling in a policy, insurers will now require your explicit consent for sharing data with third-party service providers. This new practice is aligned with the growing focus on data privacy and security.

9. Portability from Group to Retail Policies Across Insurers

Policyholders now have the option to port from a group insurance policy to a retail policy across different insurers. The portability will depend on the underwriting guidelines of the policy you are moving into.

10. Reduced Moratorium Period

The moratorium period—the period after which no claim can be denied based on a pre-existing disease—has been reduced from 8 years to 5 years.

“The insurance industry is clearly evolving to put more power in the hands of customers. These changes are designed to enhance policy flexibility, ensure greater transparency, and protect your interests. As a policyholder, it’s essential to stay informed and leverage these changes to secure the best coverage possible for you and your family,” suggests Naidu.

By understanding these updates and how they apply to your specific situation, you can make more informed decisions, ensuring your insurance coverage aligns with your needs today and in the future. You also need to consult with your insurance advisor to clarify how these changes impact your policies.