Quick Overview

If you want to cancel a health insurance policy, the rules are fairly straightforward. However, the refund depends heavily on timing. You can cancel the plan mid-term by giving your insurer a written request. If you have just received the policy document, you also get a 30-day free-look window to exit early.

The process usually looks like this: raise a cancellation request with the insurer, fill out the cancellation form, submit basic documents, and keep the acknowledgment safe. Refunds work differently at each stage.

Imagine you bought a policy because an agent said, “this is the best plan,” or an app showed “most popular.” Then, you read the fine print, which doesn’t match what you thought you were buying. Can you cancel it? And what happens to your money?

In this article, we’ll cover how to cancel a health insurance policy, how refunds work at different stages, and what to check before cancellations.

Not sure if your current health insurance policy is the right choice? Book a free call with Ditto to get a second opinion.   

Can you Cancel Health Insurance in India?

Yes. IRDAI allows you to cancel health insurance policies at any time during the policy term as long as you give the insurer 7 days’ notice in writing.  If you’ve just bought the policy, you also get a 30-day free-look period. This is your chance to read the terms properly and cancel if you are not satisfied. 

Many insurers let you initiate the cancellation online (email, app/portal login, chatbot/WhatsApp support). But they may still ask for signed forms or physical documents before they formally close the request.

How to Cancel Health Insurance: Step-by-Step Checklist

  1. Request Insurer For Cancellation

You can initiate cancellation via customer support over email, the insurer’s app/portal, chatbot/WhatsApp, or by visiting a branch. The insurer may ask you to submit signed forms. 

  1. Ask For Cancellation Form 

Most insurers share a policy cancellation form. Fill it carefully and ask what exact documents they want from you. 

  1. Keep Documents Ready

Insurers typically ask for:

    • Valid ID proof
    • A signed request letter for cancellation
    • Policy documents (some insurers may ask for originals)
    • Bank details to process the refund (if any) 
  1. Get An Acknowledgment

Once you submit the form and documents, ask for an acknowledgment or ticket number. This becomes your proof if there are delays later. 

  1. Insurer Verification + Refund Processing

The insurer will verify your documents and check your eligibility. After that, they will confirm the cancellation and process any refund. Refunds can take around 7 to 15 business days, depending on the insurer. 

Pro tip: Always keep a copy of the cancellation form, your request letter, and the acknowledgment for your records.

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How Much Refund Do You Get?

01

Before Policy Issuance

If you cancel before the insurer issues the policy, you are basically withdrawing your proposal. In case no medical tests were done, you will get a full refund. But if medical tests were done, insurers typically refund the premium after deducting medical test costs.

02

During Free Look Period

If you cancel during the free look period, you get your money back, but not the entire amount. Usually, insurers deduct medical test costs (if any) and stamp duty, so you get your money minus small deductions. If the refund is delayed, the insurer must pay interest at the bank rate + 2% on the refundable amount from the day they receive your request until the refund is made, and this must be paid automatically.

03

After Free Look Period

Insurers follow a cancellation table mentioned in the policy documents. Deductions depend on how much time has passed in the policy term. So, canceling early gets you a higher refund than canceling late. If you cancel after renewing, your refund is calculated using the same table.

04

After Claim

If you have made a claim, and it has been approved or paid, refunds are not applicable for that policy period.

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Things to Keep in Mind Before Cancelling

  1. Do You Still Need Health Insurance?

If yes, make sure your new policy is issued and active before you cancel this one. 

  1. Are You Cancelling Because Of The Insurer?

If the problem is service, claims experience, or you found a better insurer, consider porting at renewal instead of cancelling mid-year. It protects your continuity benefits better.

  1. Continuity Matters More

Cancelling and buying a fresh plan resets the waiting periods. If you or your family has any medical history, this will impact claims. 

  1. Tax Angle (Section 80D - Old Regime)

If you claimed a deduction and then canceled and received a refund, your tax position may change. A quick check with your CA helps.

Why Choose Ditto for Insurance?

At Ditto, we’ve assisted over 8,00,000 customers with choosing the right insurance policy. Why customers like Pallavi below love us:

How to Cancel Your Health Insurance Policy in India
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    • Rated 4.9/5 on Google Reviews by 15,000+ happy customers
    • Backed by Zerodha
    • Dedicated Claim Support Team
    • 100% Free Consultation

Confused about the right insurance? Speak to Ditto’s certified advisors for free, unbiased guidance. Book your call now, slots fill up fast!

Ditto’s Take on Cancelling Health Insurance

Now that you know the steps and refund rules, the only thing left is execution. In our experience, cancellations go smoothly when your request is clear, written, and properly acknowledged. Keep everything on email, save the ticket number or acknowledgment, and make sure you get a final confirmation once the policy is closed.

If the insurer delays the process or keeps looping you back and forth, don’t get stuck chasing calls. Use the formal grievance route with the insurer first, and escalate through IRDAI’s Bima Bharosa portal if needed. IRDAI states that insurers are expected to resolve complaints within 15 days.

Frequently Asked Questions

Can the insurance company cancel my policy?

Yes, but only for specific reasons like fraud, misrepresentation, or non-disclosure of material facts. In such cases, the insurer can cancel with 15 days’ written notice and usually does not pay any premium refund.

If someone buys a floater policy and one member passes away mid-year, will the insurer refund part of the premium?

Usually, no. Most floater policies continue for the remaining members for the rest of the year, and the insurer just removes the deceased member through an endorsement. Any refund is only possible if your specific policy wording allows it, and the amount can depend on timing, claims, and other underwriting rules.

If the policyholder (proposer) dies in the middle of the policy term, what happens to the floater policy?

The cover does not automatically end. The policy continues for the insured family members till the end of the term, but the insurer asks to change the proposer and update the records.

How does cancellation and refund work for multi-year health insurance policies?

Multi-year policies are treated year-wise. You may not get much back for the current policy year once cover has started, but refunds for future years are possible as per the cancellation table. 

What is the mode of refund if I cancel my policy?

Most insurers refund directly to your bank account, which is why they ask for bank details like a cancelled check or a passbook copy. In some cases, refunds may go back to the original payment method, but bank transfer is the most common.

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