Termination of contract by your Insurer.
Health insurance does not have to last a lifetime. Both the insurer and the insured can terminate the contract, whenever possible. In fact, an insurance company may not renew the policy for a specific reason. What reasons can exist to make this decision? In such a situation, what can you do as an insured?
Can an insurance company not renew the policy?
It is an annual insurance that is usually renewed automatically. However, the company can prevent the extension from continuing, something that must be communicated to the insured in writing within the indicated period.
Losing the right to coverage can be due to multiple factors that we will describe below. In fact, as they are grounds established by law, the termination regulations governing an insurance company do not differ too much from the others.
When signing a health policy, you must be aware that there are some obligations that you have to fulfill (the same happens in the case of the insurer), and if you fail to comply with any requirement of the contract, the company may refuse to renew it.
Reasons that an insurer can allege to terminate the contract
Indeed, an insurance company may not renew the policy if it deems it appropriate, taking advantage of the provisions of the Insurance Contract Law. However, a part of the insured does not know the reasons why the company can allege the termination of their contract. Next, we are going to clarify this point, listing them one by one so that you are informed about it:
What You Should Know About Termination of contract by your Insurer;
Lying, omitting information, or providing inaccurate information on the health form. This document must be filled out prior to signing the contract, so that the company can know the risk it assumes with the insured in question. If you suffer from a serious illness and do not include it in the form, once the company discovers it, it will be able to terminate the contract before its expiration. As stated in the Insurance Contract Law, the termination must be accompanied by a written statement addressed to the policyholder within one month from the date on which he became aware of the falsity of the form.
Risk aggravation. If during the term of the contract the insured suffers a serious injury or illness and decides not to inform the company, the insurer will have the power to terminate the contract. And it is that in these cases, the insurer should assume a greater risk than it is not even aware of. In addition, this can be a compelling reason to increase the premium in the next renewal, something that you would not proceed to do due to ignorance. In this situation, as specified by law, the insurer may terminate the contract within one month from the date on which the aggravation of the risk became known, a decision that must be communicated to the insured in writing. In any case,
If the loss occurs before the payment of the insurance premium is made. Said law, in its article 15, determines that if the premium has not been paid before an accident occurs, unless otherwise agreed, the company will not be obliged to cover the derived expenses.
When the insured acts in bad faith. If the loss has been caused deliberately and knowingly by the policyholder, the company will not be held responsible.
The maximum age limit established by contract has been reached. Sometimes, insurers establish an age limit and if the insured exceeds it, they can stop providing coverage. In any case, it is necessary to make a subsection, because in this case, the company does not refuse to renew the contract, but it is directly terminated, according to the conditions established in it. However, it is also possible to find insurers that offer lifetime coverage.
Can something be done about it?
If this is your case and the company has decided to terminate the contract for something that you think you have not breached, you can file a claim with the claims or defense service of the insured of the company in question.
- Insurance Agent In The United States: Everything You Need To Know (45)
- A guide to inflation, and what causes it, in the United States (13.1)
- What Should I Look For When Purchasing Landscape Insurance (13)
- Great financial apps for immigrants and newcomers to the United States (12.7)
- How To Get A Car Insurance Without A License (11.6)
If you decide to do it, keep in mind the deadlines. To find out about them, when you receive notification from the company about the termination of the contract, contact its customer service to be informed about the time you have to formally present your written claim. If the company does not think you are right, you can also present your case to the Complaints Service of the General Directorate of Insurance.