Can I cancel my Insurance policy and get my money back?

If you have paid your premium and canceled your policy before the end of the term, the Insurance Company is obligated to refund the remaining balance based on the validity of the circumstances. Please read the article for more clarity or reach out to your Insurance Provider.

Can I cancel my Health Insurance anytime I wish to?

While it is advisable to not drop a Health Insurance policy, you have the liberty to cancel it at any point in time during the policy period. However, please note that the refund amount will differ based on when the policy was cancelled.

What is the difference between grace period and free look period?

Free Look period is offered at the start of policy inception. It ranges from 15-30 days and if policyholders find the Terms and Conditions of their policy to be unsatisfactory, they can cancel the policy and receive 100% of the premiums back. On the contrary, Grace Period is offered at the end of the policy term to allow policyholders time to renew their policies. It is mostly fixed at 30 days by Health Insurance Providers in India.

Will I get a full refund if I cancel my Health insurance after the free-look period?

No, when you cancel your policy after the completion of the free-look period, you will not get a full refund. The company will charge a cancellation fee (varying from insurer to insurer), and will then refund the remaining amount.

Written by Anshika Ojha

Published: 15 Aug 2024

Updated: 27 May 2026

4 min read

Expert Verified

IRDAI Licensed

Steps to Cancel Health Insurance Policy

Especially in the post-COVID era, health insurance should be a top priority. Health plans help you manage medical emergencies and their associated costs. While the need for such policies is immense, it is equally important to be aware of their terms and conditions.

This article features important details about how a policyholder can cancel their health policies and the various pre- and post-cancellation formalities associated with health insurance in India. Policyholders can cancel their insurance cover at any point during the coverage period, without waiting until the end of the waiting period. However, the refund amount from the insurance provider depends on when the cancellation is made.

Should you even cancel your Health Insurance Policy?

Before cancelling your health policy, it is important to evaluate your current savings, medical history, and the number of dependents. Given the significant rise in medical inflation in the country, even basic tests and procedures are very costly. If you are the sole earning member in the family, a family floater health plan becomes even more critical.

In the unfortunate event that you or any family member is diagnosed with a critical illness or other health emergency, you need a contingency plan. Therefore, we strongly advise you to consider if cancelling a health policy is feasible in your situation.

Cancellation in the Free Look Period

Every health insurance policy comes with a Free Look Period of 15-30 days, starting from the policy issuance date. If policyholders choose to cancel their policies during this period, nearly 100% of the premium amount is refunded to the life insured by the health insurance provider. The Free Look Period allows policyholders to review the terms and conditions of a health plan and decide whether to continue or cancel it if it doesn't meet their needs.

Deductions in the Refund Amount

Please note that the refund amount is subject to deductions in the form of:

Prorated risk premium for the days the life insured was covered
Expenses incurred by the health insurance company for medical examination
Stamp duty and administrative charges

Cancellation after Free Look Period

You can also cancel your health insurance plan after the Free Look Period of 15-30 days. However, in such a case, you are not entitled to receive 100% of the premium amount paid to the insurance provider.

Within 1 month: If you cancel your policy within 1 month after the Free Look Period, you are eligible to receive up to 75% of the premium paid.
Within 3 months: If you cancel your policy within 3 months after the Free Look Period, you are eligible to receive up to 50% of the premium paid.
Within 6 months: If you cancel your policy within 6 months after the Free Look Period, you are eligible to receive up to 25% of the premium paid.
After 6 months: In case you decide to cancel your policy after completing 6 months of the policy term, the insurer is not liable to pay any benefits to you.

How to Cancel a Health Insurance Policy?

Request for Cancellation

If you find that the policy does not satisfy your coverage requirements or if the terms and conditions are unsatisfactory, you can contact the insurance provider. Once you communicate your request, the insurer will ask you to fill out certain forms and submit other policy-related documents.
Processing of Cancellation

Upon receiving the request, the insurance company will contact you for further details. They might ask for information such as the reason for cancellation, policy document, and the date of its receipt. They are also likely to suggest potential alternatives or solutions. If they find your reason for cancellation valid, they will process the request and initiate a refund.

General Steps Involved in Cancelling a Health Insurance Policy

Submission of Cancellation: Contact the insurance provider's support department to submit your cancellation request.
Written Request with Reason: You will likely be asked to send a written request (offline or online) with your policy details and reason for cancellation.
Initiation by Insurer: After receiving the cancellation request, the insurer will generally try to offer solutions if you have problems with the policy. If you still wish to cancel, the process will be initiated.
Deductibles and Refund: Based on the period for which you were insured, the insurer will deduct the premium and process your refund.
Official Intimation by Insurer: You will also receive an official cancellation email or letter from the insurer.

Key Questions to Ask Yourself Prior to Cancelling your Health Insurance Cover

Before you cancel, you might want to keep in mind the following factors to ensure that you are making the right decision.

Reason for Cancellation: Identify the underlying reason for dropping the health cover. Policy cancellation is subject to the validity of your reason. Acceptable reasons include the death of the life insured, mis-selling of a policy by an agent, or financial problems.
Health Insurance Portability: Many health insurance providers offer the option to port your existing policy to a different provider. If you find a similar cover at a cheaper premium, you can request your current insurer to port the policy.
Current Savings: With the rise in medical inflation, healthcare costs will continue to increase. The importance of health insurance cannot be undermined; if you plan to cancel your health cover, you should have a strong financial safety net for emergencies.
Additional Health Plans: If you already have another cover for medical illness, it might be safer to drop an unsatisfactory insurance policy. However, ensure you do not compromise on coverage.
Number of Dependents: If you have children, a spouse, or parents dependent on you and your well-being, it is essential to keep your health insurance policy. Furthermore, if there is a medical history and anyone in your family is at high risk, we strongly advise you to reconsider dropping the plan.
Refund Amount: When you have firmly decided to cancel your health policy, it is advisable to check the refund amount you will receive. If it is negligible, you can wait until the 30-day grace period. If you do not pay your premiums to renew your existing health policy within the 30-day grace period, your policy will be automatically cancelled.