What Is a Waiting Period?
Let me explain what a waiting period is in insurance terms. It's the specific amount of time you, as the insured, have to wait before some or all of your coverage actually starts working. During this period, you won't get any benefits for claims you file. You might hear it called an elimination period or a qualifying period—it's all the same thing.
Key Takeaways
- A waiting period, also known as a qualifying period, is the time before insurance coverage kicks in.
- Various insurance policies can have waiting periods, including homeowners insurance, auto insurance, and short-term disability.
- Waiting periods are often used by companies that experience high turnover rates.
- Some private health insurance plans have longer wait periods, such as for cancer or maternity care.
How a Waiting Period Works
The waiting period, or elimination period, before you can make claims differs depending on the insurer, the policy, and the type of insurance. If you opt for a longer waiting period before coverage activates, your premium costs might drop a bit. In health insurance, you'll encounter several types of waiting periods.
An employer waiting period means you have to wait a set time, like three months, before accessing company-subsidized health services. This is common in companies with high employee turnover. Even after enrolling, there might be another waiting period before you can claim benefits.
Health Maintenance Organizations (HMOs) have affiliation waiting periods, regulated by the Health Insurance Portability and Accountability Act (HIPAA), which caps them at two months—or three for late enrollees.
A pre-existing condition exclusion period can range from one to 18 months. This applies to health issues you had in the six months before enrolling. Coverage for those conditions might be limited or excluded. But if you prove you had uninterrupted prior insurance, that time can count toward the exclusion. Exemptions apply if you've had at least one year of group coverage at a job with no more than a 63-day gap.
Some private health plans impose long mandatory waiting periods for specific coverage. For cancer and cardiovascular care, waits can be up to two years. Maternity care might require 10 to 12 months, though 30 to 90 days is more common. Dental care typically has a 6 to 12-month wait, and there might be restrictions on how often you can get certain treatments, like denture replacements limited to once every five years.
When choosing a policy, you need to think about whether you can afford expenses during the waiting period.
Types of Waiting Periods
For homeowners insurance, waiting periods usually last 30 to 90 days before coverage takes effect. Once it's over, you can file claims. These periods vary by provider, and in areas like coastal zones, new policies won't start until after a named storm passes if one is approaching.
Some states add waiting periods to other products. For instance, Texas requires a 60-day wait on new auto policies, giving the insurer time to assess if you fit their risk profile. They can cancel during this time if issues arise.
Short-term disability policies might have waits as short as a few weeks, but that means higher premiums. Most wait 30 to 90 days. Long-term disability can have 90-day to one-year waits. No benefits are paid during these probationary periods. Social Security disability also has a five-month waiting period.
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