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Renewal Premium | Meaning & How It Changes

Renewal premium in health insurance means the amount you need to pay to your insurer after the initial policy term expires to keep the policy active and continue your coverage. Non-payment of renewal premium leads to loss of coverage. 

An insurer usually provides a 30-day grace period as extra time for its policyholders to pay the renewal premium after the premium due date. If you do not pay your renewal premium before the grace period is over, you lose your cover along with the continuity benefits in your policy. Securing health coverage after that requires a fresh policy application.

In health insurance, renewal premiums usually increase over the years due to several factors. An increase in the age of a life insured leads to higher risk for the insurer which is compensated by charging a higher premium. The rise in healthcare costs contributes to an overall increase in health insurance premiums. If your policy features include loyalty benefits or rewards for staying healthy or not making claims, you can use them to get discounts on renewal premiums as per your policy terms.

 

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