A non-cancellable insurance policy, otherwise known as a guaranteed renewable policy, is a type of insurance that offers optimum protection for the policyholder’s insurance benefits, premiums, and policy continuation.
As long as you are diligent with the payment of your premiums, you can access all the benefits under a non-cancellable insurance policy.
One of the benefits of this type of insurance policy is that it guarantees protection and stability for policyholders. Ultimately, making it an important policy for insurance brokers and their clients.
How a Non-Cancellable Insurance Policy Works
Just like every other type of insurance policy, there’s a system that guides a non-cancellable insurance policy.
When applying for any type of non-cancellable insurance, be it health or disability insurance, the cost depends on so many factors. Your premiums will be set based on your age and health status, including the risk of disability from your work.
A non-cancellable insurance policy often lasts for as many years as you want. You can select the period of time that you want your policy to last for.
When applying for a non-cancellable insurance policy, decide on how your insurer will adjust your premium and coverage. If you choose this type of insurance, your insurance provider has to agree that they won’t increase your premiums, alter your benefits, or cancel your policy over the life of the coverage. Whether or not you develop health issues later on, the coverage benefit and premiums remain the same for the rest of the policy.
Types of Non-Cancellable Insurance Policy
There are two main types of non-cancellable insurance policies; they include;
- Non-cancellable health insurance
- Non-cancellable disability insurance
Non-Cancellable Health Insurance: This type of insurance provided policyholders with adequate coverage and stable premiums. Thereby, ensuring that policyholders gain access to healthcare services irrespective of changes in health status or market conditions.
Non-cancellable Disability Insurance: A non-cancellable disability insurance policy offers income protection to policyholders in the event of a critical illness or disability. Aside from stable premiums, policyholders also enjoy several benefits throughout the life of the policy.
Benefits of a Non-Cancellable Insurance Policy
Non-cancellable coverage offers a wide range of benefits to policyholders. Some of the benefits include, but are not limited to:
- Long-term financial stability.
- Sufficient coverage.
- Guaranteed premium rates.
- Protection against policy cancellation.
These are some of the benefits you enjoy from purchasing a non-cancellable insurance policy. Some insurance companies may also offer other benefits aside from the ones mentioned above. You can reach out to an insurance agent about how to choose the best non-cancellable insurance policy for you.
Guaranteed Renewable
You can access the benefits provided by a non-cancellable insurance policy through guaranteed renewable. If you’re purchasing a policy that is guaranteed renewable, your insurance provider must allow you to keep your policy provided to pay your premiums on time.
Nevertheless, it is important to note that, the older you get, the higher the premiums you will be charged. The premiums on a guaranteed renewable policy can potentially skyrocket due to several reasons.
Conditionally-Renewable
To avoid high premiums, do not purchase a conditionally renewable policy. This is because this policy allows your insurer to either increase your premiums or cancel your coverage if they discover that you are exposed to a lot of risk.
This type of policy can put you at risk of losing coverage at the time when it’s most needed, and most times, you may not qualify to take out a new policy.
Although non-cancellable disability insurance provides stability for policyholders, this policy charges higher upfront premiums than other policies.
FAQS
How do insurance brokers help clients with non-cancellable insurance policies?
Generally, insurance brokers play a crucial role in helping individuals learn how to deal with non-cancellable insurance policies. Primarily, they take time to explain the terms and conditions of the policy to their clients. They also assist clients in identifying their needs and comparing and evaluating policy options.
Aside from all of these, insurance brokers also help to facilitate policy purchase and renewal. Overall, their roles encompass enlightening individuals to ensure compliance with requisitions and standards pertaining to non-cancellable insurance policies.
What challenges do insurance brokers face when offering non-cancellable insurance policies?
Insurance brokers face quite a lot of challenges in the process of helping people with non-cancellable insurance policies. Most insurance brokers face the challenges of pricing, changes in market conditions, and affordability issues. They may also struggle with educating clients on non-cancellable insurance policies.
Recognizing these potential challenges, we advise that brokers should stay informed about regulations in the industry as well as market trends. They should also focus on educating their clients on the advantages and drawbacks of non-cancellable insurance policies.
What are the different types of non-cancellable insurance policies?
Typically, there are two major types of non-cancellable insurance policies, namely non-cancellable health insurance and non-cancellable disability insurance. In non-cancellable health insurance, policyholders are provided with stable premiums and sufficient coverage that can be used for healthcare services.
On the other hand, non-cancellable disability insurance focuses on providing income protection to policyholders in the event of an illness or disability. It also features guaranteed premiums and other benefits.
