It isn't surprising that policyholders are often dissatisfied with their health insurance policies or services. The Insurance Regulatory and Development Authority of India (IRDAI) has introduced Health Insurance Portability to prevent health insurance providers from exploiting people.
How does Health Insurance Portability work?
It is simply the process of moving your medical insurance policy from one insurer to another. Like switching from one telecommunications provider to another!
Don't confuse this shift with merely changing insurers. The advantage of health insurance portability is that you don't have to start your waiting periods all over again or lose your cumulative bonuses.
Reasons for Health Insurance Portability
A policyholder may choose health insurance portability for the following reasons:
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● A lack of quality service
● Specific health issues are not adequately covered
● Settlement of claims is slow and complicated
● Reimbursement delays
● An increase in premium in the event of a claim
● Lack of transparency due to hidden clauses
● Co-payments are unacceptable
● Limits on room rent
● Other health insurance providers offer better deals
● A desire to switch to a health insurance company that offers personalised services aligned with the needs of the individual
Portability rules for health insurance
Insurance companies and policyholders must follow certain rules for health insurance portability as laid down by the IRDAI. Portability rules for health insurance include the following:
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● Like-to-like or similar policies - Health policies can be portable only if they are like-to-like or similar, i.e. if they can migrate between one basic reimbursement plan and another basic reimbursement plan or from one top-up plan to another top-up plan.
● Portability between general/specialist insurers - Policies can only be transferred from one general/specialist insurer to another, so it is important to port to an insurer of a similar type.
● A policy can be ported for either an individual policy or a family policy. During the switch, you cannot change your coverage, plan, or type of policy completely.
● Policy - Portability is only available at renewal time.
● The current insurer should be notified in writing that the individual wishes to port their health insurance policy, stating the new company. A 45-day notice should be given before renewal.
● Renewal - The policyholder should renew the policy without any breaks. If a policy discontinues due to delays by an insurer, portability will continue.
● Acknowledgement - Within three days, insurers must acknowledge portability requests.
Advantages of Health Insurance Portability:
● Policies can be customised for current health needs through portability. According to their lifestyle, one can add new nominees or add additional cover.
● New Sum Insured - A portable policy adds the existing Sum Insured to its Accrued Bonus. Portability also adds the No Claim Bonus to the new Sum Insured.
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● No time-bound exclusions - Portability is available without any time constraints.
● Pre-existing benefits continue - Portability does not affect the benefits associated with an old policy.
● Lower premiums - Competitive market conditions encourage companies to offer existing benefits at lower prices, reducing premiums for policyholders.
● Better service - Customers can choose a health insurance provider that is renowned for its excellent service and customer care.
● Improved claim settlement - Policyholders may have difficulty settling claims with their current provider. Their portability allows them to move to a company with better claim settlements.
● Transparency - By utilizing Health Insurance Portability, policyholders have the opportunity to switch to a service provider with transparent practices.
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Disadvantages of Medical Insurance Portability:
● Limited in time - Portability is only available to policyholders at renewal time. At other times, portability is not permitted.
● Policy does not change significantly - Policyholders cannot switch to a completely different policy. Only policies of similar types can be ported.
● Higher premiums - Any monetary benefit from additional benefits may evaporate with higher premiums.
● Benefit loss - Individual policies might not include all the benefits of group coverages.
Lastly,
A medical emergency can affect your mind, body, and wallet. Without health insurance, a person's savings can be wiped out in an instant. Therefore, you must choose a health insurance policy that fits your needs, lifestyle, and coverage. Take informed decisions when porting health insurance to a new company.
