Portability of Health Insurance
If you find yourself dissatisfied with the services provided by your current mobile phone service provider and wish to switch to a different company, you can easily port your mobile number. Similarly, you also have the option to port your health insurance policy, allowing you to transfer your policy from one insurance provider to another.
Portability of Health Insurance
When you change your health insurance policy from one insurance company to another, you don’t have to lose the benefits you have accumulated.
In the past in health insurance policies, such a move resulted in your losing benefits like the waiting period for covering “Pre-existing Diseases”.
Now IRDA protects you by giving you the right to port your policy to any other insurer of your choice. It has laid down that your new insurer “shall allow for credit gained by the insured for pre-existing condition(s) in terms of waiting period”.
This applies not only when you move from one insurer to another but also from one plan to another with the same insurer.
- You can port your policy from and to any general insurance company or specialised health insurance company
- You can port any individual/ family policies
- Your new insurer has to give you the credit relating to waiting period for pre-existing conditions that you have gained with the old insurer
- Your new insurer has to insure you at least up to the sum insured under the old policy
- The two insurers should complete the porting as per the timelines prescribed in the IRDA (Protection of Policyholders’ Interests) Regulations and guidelines
- You can port the policy only at the juncture of renewal. That is, the new insurance period will be with the new insurance company
- Apart from the waiting period credit, all other terms of the new policy including the premium are at the discretion of the new insurance company
- At least 45 days before your renewal is due you have to
- Write to your old insurance company requesting a shift
- Specify company to which you want to shift the policy
- Renew your policy without a break (there is a 30 day grace period if porting is under process)
IRDA has created a web-based facility to get and maintain data about all health insurance policies issued by insurance companies to individuals so that it can be accessed by the new company to which a policyholder wishes to port his policy.
This enables the new insurer to obtain data on history of health insurance of the policyholder wishing to port his policy.
Process for Health Insurance Portability Policy
If you think that health insurance portability is an excellent choice for yourself and now you are wondering how to port your health insurance policy, here are the details of how to complete the process:
First of all, you may have to fill the IRDA portability form to initiate the process. Note that a policyholder can initiate a portability request when the policy is due for renewal. You will have to approach the insurance company where you wish to port your existing health insurance policy. The new insurer will send you a couple of documents that include a portability form and a proposal form. They may also send details about various health insurance products that the company offers.
Once you fill all the necessary forms and submit it to your new insurance company, they will get in touch with your previous insurer for obtaining your medical records and other related information. They might also ask for your claim history. Your old insurance company is bound to share this information via IRDA i.e. the insurance regulator when they receive such requests.
When the new insurance company receives all the required details, they will decide whether or not they wish to provide you a health insurance policy. This is called underwriting of a policy. An underwriter will analyse the data related to you and consider your risk profile to decide about providing health insurance to you. Your new insurance company is supposed to underwrite your policy within 15 days if they decide to insure you. In case of a delay in this time period, it is considered that you are insured under the new insurance company.
Documents Required For Porting a Health Insurance Policy
The process of porting a health insurance policy can differ slightly based on the terms and conditions of the insurance company. You need to get in touch with your current and previous insurer to understand the exact set of documents required for the purpose of porting the policy. You may be asked to submit the following documents to initiate the process:
- Identity Proof
- Address Proof
- IRDA portability form
- Proposal Form
- Insurance Policy
- Claim History if applicable
- Declaration of no claims, if applicable
- Documents related to medical history
Advantages & Disadvantages of Health Insurance Portability
Switching to a new health insurance company has its own set of advantages and disadvantages. We will discuss both in this section. You can read through them and then decide whether you want to make a switch to a new insurer or renew the existing health insurance policy at your current insurance company.
Benefits of Porting Health Insurance Policy
Benefits of porting to a new health insurance company are as follows:
- Customize the Policy- You have an option to customise the policy to an extent. This way you can make changes in the policy to suit your existing needs from a medical insurance policy.
- No Claim Bonus- In case you have an accumulated No Claim Bonus on your existing policy, your new insurer will calculate this discount and incorporate it with the amount of premium you are supposed to pay. Thus, you can continue to avail the benefit of No Claim Bonus by leading a healthy lifestyle.
- Health Insurance Benefits- Apart from the accumulated No Claim Bonus, all the other benefits of your policy remain intact even after you make a switch. Porting allows you to keep the existing benefits and avail new ones with a new insurer.
- Premium- The current health insurance market in India is brimming with competition. Insurers want policyholders to join them and buy a health insurance policy. Thus, porting the existing policy may lower your premium while the benefits may increase
Disadvantages of Porting Health Insurance Policy
Disadvantages of porting to a new health insurance company are as follows:
- Porting on Renewal- As mentioned earlier, porting a health insurance policy is only possible near the date of renewal. A policyholder may not be allowed to port the policy when the renewal date is far away.
- Changes in Plans- Changing the existing health insurance policy drastically is not allowed. You can make certain changes in the extent of coverage, however, changing the whole plan is not possible.
- Extra Coverage- The policyholder needs to pay a higher amount of premium for buying any kind of additional coverage at the new insurance company.
What to Do If They Reject Portability Requests?
There could be a few reasons why one’s health insurance portability gets rejected. Let’s take a look at these reasons and understand what a policyholder can do in such cases.
- Providing incomplete information-This can lead to rejection because the new insurance company is not provided with true and complete information about the policyholder. Getting in touch with the insurance company to provide all the required details might be done to get an approval.
- Not submitting the documents in time- As mentioned earlier, there is a timeframe in which the policyholder needs to get in touch with the new insurance company and apply for a switch. If there is a delay, the request for porting the policy may get rejected. The policyholder must now wait for the next renewal date and make sure that necessary timelines are followed.
- Claim history- There are high chances that your request for porting the policy may get rejected if the claim history is not proper. The company has a right to reject the request in case of frauds or misrepresentation of information.
Things to Remember While Porting For Health Insurance
A medical emergency can affect a person in both financial and emotional ways. It can easily deplete your savings if you do not have proper health insurance coverage. Buying a policy without considering your needs, lifestyle, and coverage can have a huge impact on the claim amount. Thus, it is important to consider the following things while porting your health insurance policy from one insurer to another.
- Limits and Sub-limits- Each type of coverage of a health insurance policy has a certain cap on the claimable amount. For example, the daily room rent could be capped to Rs. 2500. You need to check such limits when you port health insurance policy and make sure that you are okay with the limits and sub-limits of the new policy.
- Benefits- Each health insurance policy is designed to provide certain features that are helpful for the policyholder. You need to understand that these features or benefits are limited to the policy and cannot be ported. For example, if your old policy offers pre-hospitalization coverage for 30 days and the new insurance company offers this coverage for 15 days, you cannot change this feature. You have to make do with the new coverage.
- Premium- The new insurance company may offer a lower premium for a similar insurance policy. However, you need to make sure that the coverage offered for a lower premium is sufficient for your needs. Lower premiums for a lower coverage will increase your out of pocket expenses at the time of a medical emergency. ‘Out of pocket expenditure’ refers to the money you pay directly to the hospital or a medical facility without the involvement of the insurance company.
Frequently Asked Questions (FAQs)
Here are some answers to the most asked questions related to Health Insurance Portability.
From the article, I understood that making a switch between two insurance companies is possible. However, is it possible to switch between plans in the same insurance company?
Yes, it is possible to switch to a new health insurance policy offered by the existing insurance company. This process will not take as much time as switching to a new insurance company, because your current insurer already has all the details required to make a switch.
I have already served half of the waiting period. Will it reset upon porting the policy to a new health insurance company?
Probably not. If the applicable waiting period for a specific condition is similar to that of the old policy, then you may only have to serve the remaining waiting period under the new plan. However, this solely depends upon the terms and conditions of the new health insurance company.
Why should I port my health insurance policy?
You should port your health insurance policy if you are not happy with the services provided, coverage, or premium with respect to the current insurance company and your health insurance policy.
Does the age of a policyholder matter while porting health insurance?
Yes, the age of a policyholder is a vital factor while porting the policy. The older the person the more will be the health insurance premium. An insurance company may also reject a proposal based on the risk factor associated with the age of a policyholder.
Is it a good idea to buy health insurance coverage from two different insurance companies?
Buying health insurance from two different insurers depends upon the coverage being purchased. There is no point in buying similar coverage from multiple insurers. Instead, consider buying different coverages to create a comprehensive health insurance portfolio. This can provide all-round coverage in the time of a medical emergency.
Info sourced from: https://policyholder.gov.in & https://www.acko.com
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