Moratorium Period in Health Insurance: Why It Matters

• Written by Sambriddhi Sharma

  Reviewed by Ritika Malik

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Have you ever purchased a health insurance policy only to discover that certain pre-existing illnesses you already have are not covered immediately?

That’s precisely why the moratorium period exists — to protect honest policyholders from such surprises. It’s one of those lesser-known terms that can make a huge difference in your claim experience. So, let’s break down what a moratorium period in health insurance is in simple terms.

What Does Moratorium Mean in Health Insurance?

To understand this better, let’s start with the basics — what does moratorium mean?

In simple terms, a moratorium refers to a legally authorised period of delay or suspension. In the context of health insurance, it refers to a specific time period after which the insurance company cannot question the authenticity of your policy or deny claims on the grounds of misrepresentation or non-disclosure, unless it’s proven to be fraudulent.

As per the IRDAI(Insurance Regulatory and Development Authority of India) guidelines, the moratorium period is 5 years (reduced from 8 years) from the date of policy inception. Once you’ve completed this period continuously, your insurer cannot reject claims based on old information or disclosures you made when buying the policy.

Why Does the Moratorium Period Exist?

Many people wonder why insurers have this rule at all. The moratorium period in health insurance extends beyond a mere timeframe — it’s a trust-building mechanism.

Insurance is all about good faith: you disclose your health conditions honestly, and the insurer promises to protect you. However, sometimes claim rejections occur years later due to minor discrepancies in records. To avoid this unfairness, the IRDAI introduced the moratorium clause.

This clause ensures that after five consecutive years of maintaining an active policy, the insurer can’t reopen old files to question your medical history or disclosures (except in cases of suspected fraud). This makes your policy more secure and gives long-term policyholders a stronger sense of assurance.

How Does the Moratorium Period Work in Real Life?

Let’s understand this with an example.

Riya bought a health insurance policy in 2016. She disclosed her thyroid condition at the time of purchase. She paid her premiums every year without fail. Now, in 2024, her policy completes 5 years — meaning her moratorium period has ended.

From this point onwards, her insurer cannot deny any claim by questioning her 2016 disclosures (unless there’s proven fraud). So, if she files a claim in 2025, she’s fully protected from disputes over her initial policy information.

This provision encourages people to continue their policies for the long term — because the longer you stay, the stronger your coverage protection becomes.

Moratorium Period Vs Waiting Period Vs Look-In Period?

These three terms can often be confusing to policyholders, but they serve distinct purposes. Here’s a quick comparison to clear the air:

What Happens After the Moratorium Period Ends?

Once the moratorium period is over, your policy becomes much stronger. Your insurer cannot deny your claim by digging into past details you disclosed at the time of purchase unless they can prove fraud or intentional misrepresentation.

This provides a strong layer of protection and ensures that your years of loyalty and consistent renewal are duly rewarded.

Important: It’s also worth noting that any permanent exclusions clearly stated in your policy remain in effect. For example, if cosmetic treatments or infertility-related expenses are excluded, they will remain so even after the moratorium period.

How Can Policyholders Benefit from the Moratorium Clause?

Here’s how you can make the most of this feature in your health insurance policy:

• Be transparent while buying your policy. Disclose every health condition honestly, even if it seems minor.
• Renew your policy without breaks. The moratorium period counts continuous years, so never let your policy lapse.
• Keep your documents safe. Store your medical reports, renewal receipts, and communication with the insurer for future reference.
• Stay insured long-term. The real advantage of this clause becomes apparent only after 5 years, so consider health insurance a lifelong investment, not a short-term solution.

How Do Insurers Apply This Clause?

Leading insurers, such as Care Health Insurance, strictly follow the IRDAI’s moratorium guidelines. They ensure that policyholders enjoy full transparency and trust once they’ve completed their 5-year policy period.

So, if you’ve been renewing your Care Health Insurance policy regularly, you can rest assured that your coverage becomes even stronger after the moratorium period ends. It’s a small clause with significant implications for your financial security and peace of mind.

Why Knowing About the Moratorium Period Matters More Than You Think

When it comes to health insurance, understanding these finer details can save you from significant stress in the future. Many policyholders focus only on coverage or premiums but overlook clauses like this, which actually decide how smooth your claim experience will be.

Understanding the moratorium period in health insurance gives you more control over your policy. You also understand the importance of maintaining continuous insurance coverage and being honest when applying.

>> Read More: All You Need to Know About the Grace Period in Health Insurance

A Clause That Rewards Trust and Loyalty

At its heart, the moratorium period in health insurance is simple — it’s a promise that after five years of trust and consistency, your insurer will stand firmly by you.

Think of it as your policy’s “trust badge.” It’s proof that the system rewards transparency, discipline, and long-term commitment.

So, the next time someone asks you what a moratorium means in a health insurance context, you’ll know it’s not just a technical term — it’s one of the strongest protections every responsible policyholder should know about.

Disclaimer: All plan features, benefits, coverage, and claims underwriting are subject to policy terms and conditions. Kindly refer to the brochure, sales prospectus, and policy documents carefully.