Be aware of the underwriting options when applying for health insurance
With this type of underwriting, health insurance applicants aren’t required to make any medical declarations. Any new or unexpected medical conditions that occur after the policy has started will be covered according to the policy conditions.
How does this affect pre-existing conditions?
If you sign up for a policy with moratorium underwriting your pre-existing condition may be covered if you have:
- NOT experienced any symptoms related to your pre-existing condition
- NOT gotten advice or tests from a health practitioner regarding you condition
- NOT required treatment or medication for the condition, and
- NOT received treatment or medication for the condition in the 2-5 years prior to the policy start date.
If, for two years after the start date of the policy you continue to fulfill all the criteria above, then your condition will be covered again.
If you have had symptoms, advice or treatment for a condition in the (typically) five years before the start of the policy then there is likely to be a complete ban on that condition. This is all subject to the terms and conditions of your policy.
So what is full medical underwriting?
Full medical underwriting is the more usual way of applying for health insurance. It involves a full medical history disclosure. Any cover offered is based on your medical history and will likely exclude pre-existing conditions.
Why choose moratorium underwriting?
The application process is much quicker and simpler than with full medical underwriting. With moratorium underwriting there is half the paperwork and health questions are limited to smoking habits and health care provider details.
If you have no health issues you can take out cover quickly and even fill in all the forms online. For those with health problems in their past moratorium underwriting may be more beneficial. There are many conditions that ordinarily wouldn’t be covered with a full medical disclosure. Providing you stay symptom, advice and treatment free for the specified time then cataracts, mole and cyst removal and joint replacements are among those things that can be covered.
Are there any drawbacks to this type of underwriting?
Moratorium underwriting has been criticised as being unclear for policy holders. People may be unsure what is covered until they make a claim. delays can also occur when a claim is made as insurers check with doctors about whether a treatment is covered.
Policy holders have a two year window in which they need to remain advice, treatment and symptom free in order to be covered for pre-existing conditions by their policy. If they break these rules they have to start the two year waiting period again. This presents a risk that policy holders could be tempted to delay treatment or seeking advice for existing conditions.
Which companies offer moratorium underwriting?
More companies are offering the choice or moratorium underwriting, though many still only have the full medical option. The following are just some of the companies that offer moratorium policies:
- Aviva – MyShield policy
- WPA
- Simply Private Health insurance – must be applied for online