What Happens To Health Insurance After Policyholder Dies?

Health Insurance Categories and Do They Cover Death?

Read below to understand the impact of the death of a policyholder on each category of health insurance plan available in the market.

1. Individual Health Insurance

   An individual health insurance plan is liable to cover only one individual. Under an individual health plan, you are entitled to the full amount of the health insurance plan for hospitalisation, daycare, AYUSH, and many other healthcare features.

   Death benefit

   In case of the individual policyholder’s demise, the policy will be terminated. In such a scenario, the family members of the insured individual can raise a claim if the policyholder dies during hospitalisation.

   However, if the policyholder opts for a second insured member under the individual plan, the second insurance member continues to receive health insurance benefits even after the policyholder’s demise.

2. Family Floater Health Insurance

   A family floater health insurance covers multiple family members under a single sum insured which is shared by all family members till exhaustion within a policy term.

   Death benefit

   In case the primary policyholder passes away, other family members will be covered under the health insurance plan. However, if the primary policyholder paid premiums, the health insurance provider must be intimated immediately.

   This allows the health insurer to update the policy details of the primary policyholder.

3. Group Health Insurance

   Group health insurance is a health cover provided to you by your employer. The health insurance plan benefits and features are decided by the employer as per the overall requirements of its employees.

   The group health insurance is similar to a family floater health plan, with the employer having major control over the health plan.

   Death benefit

   In case of the employee’s demise, the group health insurance policy will be terminated for the insured individual. The dependants do not receive any coverage unless mentioned in the health insurance policy.

   If the health insurance plan compensates for the death of the employee, it will be provided to the nominee.

4. Critical Illness Health Insurance

   Critical illness health insurance covers you against the listed health ailments in a policy schedule. The health ailments can range from cancer, strokes, neurological disorders, heart ailments, etc. This category of health insurance will offer you a lump sum amount on diagnosis of any critical ailment covered under the policy.

   Critical illness health insurance requires you to survive for a particular amount of time before the coverage is activated. This period is known as the ‘survival period’.

   Death benefit

   In case of the unfortunate demise of the policyholder within the survival period, there is no death benefit or coverage sum insured paid to the nominee and the policy is terminated.

5. Senior Citizen Health Insurance

   A senior citizen health insurance plan covers you if you are above 60 years old. This category of health insurance is similar to an individual health insurance plan.

   Death benefit

   In case of the unfortunate demise of the policyholder, a senior citizen’s health insurance plan is terminated automatically. The health insurance provider covers you only for the treatments availed but not for a death benefit.