Health insurance is often understood only when a medical emergency strikes. Unfortunately, for many people, that realisation comes too late. Over the years, as a health insurance consultant, I have seen multiple situations where individuals genuinely wanted to buy health insurance—but were either declined or offered limited coverage due to their medical condition or age.
Understanding who may be declined health insurance and why insurers impose waiting periods or exclusions is crucial for anyone planning their healthcare finances.
Who Can Be Declined Health Insurance?
Health insurance companies assess risk before issuing a policy. Certain medical conditions are considered high-risk, where the probability of claims is extremely high. In such cases, insurers may outright reject the proposal.
People who have already suffered from major illnesses such as:
• Heart attack
• Paralysis
• Brain stroke
• Kidney, liver, or lung failure
• Advanced-stage cancer
are often declined because the chances of hospitalisation or recurring treatment are almost certain. Health insurance is designed to manage future unforeseen medical expenses, not ongoing or known critical conditions.
Conditions That May Be Accepted With Restrictions
Not every medical condition leads to rejection. Some applicants with manageable or early-stage ailments may still be considered, but with conditions such as:
• Mandatory pre-medical tests
• Higher premiums
• Disease-specific exclusions
• Long waiting periods before coverage begins
Common conditions like diabetes, hypertension, thyroid disorders, asthma, obesity, or heart-related indicators may fall under this category. If the insurer’s medical team feels there is a strong possibility of complications, the proposal can still be declined.
Waiting Periods & Exclusions: A Reality of Health Insurance
Every health insurance policy has waiting periods. Certain diseases are covered only after 2–4 years, while some specific treatments may never be covered under a particular plan. These clauses exist to prevent misuse and ensure the sustainability of the insurance system. This is where many people misunderstand health insurance. Buying a policy does not mean everything is covered immediately. Coverage grows with time and continuity.
A Real-Life Experience: The Cost of Delay
One of my relatives, an 80-year-old, took nearly 8–9 months to decide on buying health insurance, after so many questions, comparisons on various aspects, and many discussions. He was physically active, disciplined, and maintained a healthy lifestyle. When we finally initiated the proposal, he underwent pre-medical tests. The reports revealed certain complications, and the insurer declined the proposal. The search to find suitable health insurance that can provide coverage, possibly with some conditions, is still on.
Today, the person has no health insurance cover. If the person faces hospitalisation due to illness or an accident, all medical costs will be paid out of pocket. Imagine having mutual fund savings of even 1 Cr.; just one hospital bill of 10 lakhs or 20 lakhs would straightaway reduce your 1 Cr. to 70 lakhs–80 lakhs. Paying 30,000–50,000 or even 1,00,000 every year as a health insurance premium providing coverage of 50 lakhs to 1 Cr. saves you 20–30 lakhs in one go. Isn’t it a good deal?
Even if someone has sufficient savings, accessing large sums during a medical emergency is not easy. The burden often shifts to family members—each with their own financial responsibilities. Questions arise: who will contribute how much, when will the money be returned, and what if the expenses are huge? Medical emergencies don’t just affect health; they disrupt entire families financially and emotionally.
A Common Question
Can We Buy Insurance After Diagnosis?
Recently, a friend asked me if health insurance could be bought for someone diagnosed with cancer just two days ago—and whether it could be backdated. The answer is simple but difficult to accept: health insurance does not work that way. It is meant to cover medical expenses arising from uncertain future events, not known medical conditions. This is exactly why people say, “Buy health insurance when you don’t need it, because you may not get it when you need it the most.”
Why Buying Early Is the Best Decision
When you buy health insurance early and maintain it without lapses:
• Firstly, you are healthy, so you can get coverage without any medicals till the age of 50–55 years
• You get broader coverage without any conditions
• Waiting periods get completed during your healthy age
• Premiums remain affordable; some policies offer no increase in premium till the first claim
• Future illnesses get covered seamlessly
Yes, health insurance has its challenges—clauses, exclusions, and paperwork. But so does everything else we buy in life. That does not mean it won’t work for us. Health insurance works best when it is bought early, continued consistently, and used responsibly. Having the right advisor who can give unbiased advice is important. It is not just a policy—it is financial stability during life’s most vulnerable moments. The right time to buy health insurance is not after diagnosis. The right time was yesterday, but today is also good, if you are still healthy.
(The writer is the founder of ‘Investment Options’, an insurance and investment consultancy based in Goa since 2013, with pan-India clientele)
