Why you must disclose pre-existing conditions before buying health insurance

Discover why disclosing pre-existing conditions in health insurance is vital. Understand what counts as a pre-existing disease, like diabetes or asthma. Learn how disclosing these affects your policy: it helps insurers set fair premiums, avoids claim rejections, and ensures coverage for related health issues. If you hide your medical history to save money, you risk your policy being voided or claims being denied later. Don't overlook the mandatory waiting periods, increased premiums, and potential exclusions that come with undisclosed conditions. Use a health insurance premium calculator to check how honesty about your health can save you trouble and money in the long run.

With poor dietary habits, job-related stress, or sedentary behaviours like alcohol consumption or smoking, it is common to see even young people dealing with some form of disease. However, with health insurance in place, you need not worry about the medical bills these ailments can bring. But have you ever considered the impact of a pre-existing disease on a health insurance plan? Have you wondered about the consequences you might face if you do not disclose your medical history to your insurer to save a few hundred or thousand rupees? If not, keep reading to the end.

What is a pre-existing disease?
A pre-existing disease refers to any illness, condition, or symptom you had before buying a health insurance policy. It could be anything from diabetes, asthma, or high blood pressure to a past surgery. When you apply for insurance, you are required to disclose your medical history. The insurer uses this information, along with any required medical tests, to determine whether a condition qualifies as pre-existing.

What are the common pre-existing conditions?
Some of the conditions you need to disclose while buying health coverage are:
   • If you have high blood sugar levels and are on regular medication or insulin, the condition qualifies as pre-existing.
    • Hypertension, which means high blood pressure, whether controlled with medication or not, also falls under this category.
    • If you use inhalers or medications for breathing issues, such as asthma, it is considered a pre-existing respiratory condition.

    • Both hyperthyroidism and hypothyroidism, when managed with daily medicines, are recognised as pre-existing conditions.
    • You must disclose any history of heart attack, bypass surgery, or ongoing use of cardiac medication.
    • If you have had any form of cancer in the past, even if you are currently in remission, it is still considered pre-existing.
   • Ongoing joint pain or stiffness that requires regular care or medication is also included.

  • Chronic liver infections or kidney issues, such as a history of dialysis, are treated as pre-existing conditions.
    • If you are taking psychiatric medication, it must be reported as a mental health-related pre-existing condition.

Why is it essential to disclose pre-existing conditions?
Disclosing a pre-existing condition helps the insurer understand the financial risk of providing medical coverage to you. It enables them to assess the premium for your profile accurately. If you omit information about your existing health, the insurer has the right to reject your claim.

For example, suppose you have been battling diabetes for years before purchasing the policy, but did not disclose this information to your insurer. Two years after buying the policy, while it is still active, you are diagnosed with a kidney disorder. Upon assessment, doctors determine that the root cause is diabetes, and the condition is diagnosed as diabetic nephropathy. In this case, even if kidney ailments are covered under your policy, the insurer will reject your claim.

Impact of a pre-existing condition on health insurance 
Here are some of the reasons why disclosing pre-existing conditions is crucial.
 • Mandatory Waiting Period
The insurer imposes a waiting period for pre-existing conditions. It is the duration after purchasing a health plan when you can claim the policy benefits. The waiting period is different for different ailments. Depending upon the condition, the duration can go up to 36 months. 

    • Premium Loading
Pre-existing conditions increase the insurer's risk by raising the probability of claim filing. To mitigate this risk, insurers apply a loading charge on the premium when you buy a policy. For example, if you have diabetes, your premium will be higher compared to someone of the same age who does not have any medical issues.

    • Policy Rejection Risk
If you have a terminal illness like HIV or stage four cancer, where the chances of survival are almost nil, the insurer may deny coverage. This is not arbitrary but is based on medical underwriting that evaluates long-term claim risk and treatment costs associated with the condition.

    • Additional Medical Tests
When you declare a pre-existing condition, the insurer may ask you to undergo extra medical screening. These tests assess the severity and current status of your illness. If the reports indicate progression or poor disease control, it can result in stricter terms, such as longer waiting periods, higher premiums, or exclusions. 

   • Ineligibility for No-Claim Bonus
If you are dealing with a chronic illness, then after you complete the waiting period and the policy covers your condition, you may lose a no-claim bonus (NCB) benefit. The reason is that such illnesses require frequent and prolonged hospitalisation every policy year, triggering claims. For those unaware, NCB can either reduce your premium or increase the sum insured amount without incurring any additional costs. 

  • Limited Policy Options
Individuals with pre-existing diseases may face fewer choices when selecting a health plan. Many insurers either decline such applications or offer only basic coverage with restrictions. Depending on the insurer, high-end policies with extensive benefits, low waiting periods, and top-up features may be unavailable to such applicants. 

    • Exclusion of Specific Illnesses
Even if the insurer accepts your application, they may exclude treatment for a specific pre-existing illness altogether. This is known as permanent exclusion. Let's say you have asthma in a hypothetical scenario. In this scenario, the insurer may cover other health issues but permanently exclude any respiratory-related hospitalisation or medication costs.

Conclusion 
Disclosing pre-existing conditions before purchasing a health insurance plan is crucial for multiple reasons. It allows insurers to assess your risk accurately, determine your premium, and prevent claim rejections. Failure to disclose relevant health information could lead to your policy being voided or, depending on the insurer, denial of coverage for pre-existing conditions and any related health issues. It is recommended that you use a health insurance premium calculator to see how your medical history impacts the cost of coverage.
Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.