Insurance Regulatory and Development Authority (IRDA) The apex regulatory body of the Insurance Industry released circular providing guidelines for portability for health insurance policies in India.
As the name implies, it allows the switching of the medical policy of one company to another without losing protection due to exclusion.
If a client is covered by a policy and wishes to change insurers after a year, they can make the change while still enjoying the benefits of carrying over the waiting time.
Another significant milestone in the overall insurance industry in India.
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What is the definition of portability in health Insurance?
The portability process is through which you, as a policyholder, can transfer your current health insurance to a health insurance plan with an alternative insurer or to a different health policy of that same insurance company.
In this way, it is possible to carry your current benefits onto the new health insurance policy.
The policyholder is also able to transfer the entire benefits of continuity, such as free medical examinations or no-claim bonus, or a reward offered by an insurance company to the policyholder who has made no claims in the duration of the policy that was accumulated through the previous policy.
What type of Policy Port
Porting options are offered for family-floater and individual policies provided by non-life insurers.
The policyholders can switch over from group health insurance plans to an individual insurance plan without losing the benefits offered by the previous health insurance.
Why Portability is important?
The reasons to switch from one insurer to the next may include poor service, higher copayment (cost-sharing arrangement in which the policyholder contributes an amount of the bill out of his/her pocket), or greater sub-limits (cap on the amount of coverage for specific treatment) and more families and the more coverage options and cashless services.
The portability of health insurance has several benefits. First, suppose the policyholder has already been through an initial wait period (30 days) and has already served the previous waiting period (ranging between 24-36 months) and the specific waiting time.
In that case, it will be canceled in this new health policy. The no-claim bonuses you have earned can be transferred.
Keep in mind that when you transfer the bonus, it will be calculated based on the larger SI and will include the NCB.
One of the major advantages of porting your health insurance is that you will get the most current policy that usually includes broader coverage and more benefits like rewards points for a healthy lifestyle and the benefits of wealth (such as points that are higher for being physically fit), OPD covers, counseling, and telemedicine.
Porting procedures nowadays are relatively easy.
Reason for rejection of Portability
It is possible that you could be denied the right to port your health insurance when you suffer from a pre-existing illness.
Therefore, it is recommended to declare the current medical conditions you suffer from prior to porting a health insurance plan.
There is a higher risk of developing health issues as you get older. In most cases, portability application for seniors is not accepted.
The requirement for health insurance will be most significant in old age.
Disadvantage of Portability
If you, as a policyholder, opt to port your current health insurance policy, bear on your toes that you must do so at a minimum of 30 days before the date for renewal of premiums on the health insurance policy, but not in the course of the duration of the policy.
It is only possible to port between similar policies.
For example, if you are covered by regular health insurance and want to switch to a policy for critical illness.
How to Port Health Insurance Policy
The policyholder must inform the health insurance company by submitting the completed form 45 days before the renewal of their current health insurance plan since the portability process can be completed during the renewal of health insurance.
The policyholder must select an appropriate health insurance policy, complete the proposal form, and then submit it to portability forms.
When the form for portability is accepted, within five days, the insurance company must request the required information from the previous insurance company and begin the procedure under the latest IRDAI guidelines.
When the new insurance company has received all the necessary information, it has the power to choose between accepting or denying this policy in the stipulated time frame.
If the decision isn’t completed within this time, the company will be required to accept the application for portability.
Document required for Portability
- Proposal Form and the Portability Form to be be completed with signatures and then submitted with the other documents,
- The policy copies from the previous insurance.
- Identity Proof
- Medical details & claim History
- Medical examinations for pre-insurance where appropriate.
Medical insurance portability has become an option. This gives us another chance to make our budgeting and financial plan more effective by joining the insurance company we believe is the most reliable.
Medical insurance companies are upgrading their services to keep clients and draw customers from other insurers.