How far back can an employee's insurance policy be terminated?
Every insurance carrier has their own rules for how far back an employee’s insurance policy can be terminated. Some carriers only go back 30 days, while others go back 60. (e.g. If an employee was terminated 11/13/22 and your broker receives the notice 1/3/23, your broker may only be able to terminate retroactively to 12/31/22, causing the company to pay for the employee’s insurance premium when the employee was no longer employed.) In order for your insurance broker to process the termination in a timely fashion, it is best practice to give an employee’s termination notice on that date or soon after.
If your insurance broker receives this information weeks after the termination date, there is no guarantee that the employee’s insurance policy will be terminated on the desired date. This is due to insurance carrier rules, which insurance brokers do not have control over.
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