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Waiting Period

Waiting period refers to the time between the period of registration filing with the SEC and the time of the declaration of the registration statement effective by the SEC. It is also known as “quiet period” and sometimes “cooling-off period”. In heath insurance waiting period is referred to as the period of time stated in a health insurance policy, which should be passed before all the coverage of the health care can begin. There are three types of waiting periods in health insurance. First is the employer waiting periods, then the affiliation periods, and lastly the pre-existing condition exclusion periods.

Employer waiting periods is the most common type of waiting period. It is found in the employer group plan, where in a new employee must in given period of time, often times it is within three months before a person can be qualified for health care benefits. On the other hand affiliation period is the one imposed by an HMO instead of an employer. Affiliation period does not last longer than three months and it is attached with a specific rules. While the pre-existing condition type period involves those people who have a condition within the six months before the signing of the health insurance. The insurance coverage of this type of waiting period can be excluded or limited for pre-existing condition.

In finance, an example of waiting period is when filing of documents in a government regulatory agency is done. Typical case is that company should file its intentions in an appropriate government agency, and gain approval in issuing the offering, then observe a span of time before the company begins to announce to the public. This kind of waiting period is applicable for three calendar months. With regards to insurance claims, the waiting time depends on the time from the filing of the claim up to the point where in the insurance company settles the particular claim; it can be in a form of rejecting the claim or paying it. Most insurance coverage gives specific provisions in relation to the filing of claims; it also includes the waiting period of the insured party for the claim to be finally settled.

One advantage of waiting period is that all parties are allowed to be involved in the deal while investigating the claims of the proposed action. Insurance companies have also its own share of benefits form using waiting period or elimination, because it gives time to verify the information related to the claim and determining if the payment to the other insured party is in order as what is stated in the terms and conditions of the his or her insurance policy. It is in the insurance policy that the obligations of the insurer to a premium-paying policy holder. Using waiting period can help minimize the possible occurrence of insurance fraud, where in it can save an insurance company from losing a big amount of money. Likewise the use of elimination or waiting period does not directly help in lowering the insurance premiums compared to what they would be.