Let us assume that you have visited a mall and are shopping for your friend. You pick up a pair of jeans from your favourite brand as a birthday gift for the friend. Once you hand it over to your friend and he/she tries the same, they find out that it is a bit tight at a few places and it makes them feel a bit uncomfortable. The most obvious option at this point is to exchange the pair of jeans and opt for one that fits in perfectly.
If you can do the same with your jeans worth a few thousand rupees, shouldn’t you be able to do the same with your health insurance as well? It is not uncommon for policyholders to be displeased with their health insurance policy. To ensure that they do not feel trapped, the IRDAI or the Insurance Regulatory and Development Authority of India has made way for health insurance portability.
What is Health Insurance Portability?
Health Insurance companies allows their customers to change the insurance company at the time of renewal with the benefits of continuous renewals. It simply means that if you are not happy or satisfied with the claim or the procedure or service of your health insurance company, you can opt to change the same without any penalty for the same.
The concept of health insurance portability isn’t entirely new; however, some modifications made by the IRDAI have made it more consumer friendly. Health insurance portability ensures that you are not stuck with a bad health insurance.
Whatever the reason maybe, you can switch your health insurance policy from existing insurer to another insurer; all this while not losing any benefits that you have accumulated over time. The most common example of it would be, continuing with the waiting period for pre-existing diseases. The health insurance portability also keeps intact any of the time bound exclusions that you might be subject to.
Health Insurance Portability: The data
Health insurance portability has changed the dynamics of health plans and it operates like an open competition like motor insurance policies. Over 1 lakh customers have ported their health plans in the FY 2017 itself into private insurance companies where a large chunk has been from the four public sector companies. This rule has benefited the customer tremendously.
Know your rights
If you are not happy with your current health insurance and wish to port to another insurer, knowing your rights is of prime importance. Here are some of them.
- You can port either individual policies or floater family policies.
- The new insurer must provide you with sum insured that matches the previous policy.
- You have the ability to port your health insurance from a general insurance firm to a firm providing only health insurance plans and vice versa.
- Any credits related to the waiting period of pre-existing diseases or exclusions that are time bound will be passed on from the old insurer to the new insurer.
- The IRDAI has fixed timelines when it comes to porting a policy and both the insurers must adhere to it.
Policyholders who have had a really tough time with their current insurers can only port their policy if the following conditions are met.
- The porting of a health insurance policy is only allowed during its renewal phase. You cannot port the policy midway through its term. The porting request must reach the new insurer at least 45 days before renewal.
- The new insurer must provide credits for pre-existing conditions for the existing sum insured; however, all other benefits are at the discretion of the insurer.
- Once you have made up your mind to port the policy, you need to do the following:
- Inform your existing insurer about the switch.
- You need to mention the name of the new insurer.
- There must not be any break when you are porting the policy. (Though the IRDAI provides a 30 days grace period, you must strictly get the porting done within this period)
Can a porting request be rejected?
There are a few situations where your request for porting the health insurance can be turned down by the new insurer. Some of these conditions include.
- If you cannot furnish any documents from your previous policies or any delay from your end. Insurers expect the policy documents of at least three years.
- As a policyholder if you fail to provide all adequate information.
- Too many claim requests in the past might tick a new insurer off.
- If there has been a break in the policy, the insurers might reject the application.
- And lastly, if there is a huge gap when it comes to the exclusions and benefits provided by your existing insurer and potential new insurer.
Situations when your insurer needs underwriting:
There could be reasons when your insurer needs to check with the underwriter under circumstances like:
- Increase in sum insured: You choose to increase your sum insured. In that case, the increased sum insured will be underwritten as per the companies underwriting norms with no exception
- Age matters:If you choose to port at an older age, the porting may not be too easy. Insurers might be unwilling to undertake risk at an older age.
- Adverse health history:In case of extreme adverse health history with severe pre-existing ailments, it depends on the insurer’s underwriting guidelines to accept the health insurance porting.
Porting of a health insurance comes in handy if you are not happy with the services that your current insurer has on offer. With the regulation changes brought in by the IRDAI, the porting has become simpler than what it used to be. So, don’t think that you are stuck with a single health insurance policy for the rest of your life. You can very well change your insurer without affecting the continuity benefits.