Health Insurance Portability

Health Insurance Portability – The recent guidelines issued by the Insurance and Regulatory Development Authority of India (IRDA) on Health insurance portability gives the policy holder the flexibility to switch from one health insurance provider to another such that the credit gained by the insured for pre existing condition(s) in terms of waiting period when he/she moves from one insurer to another or from one plan to another. This feature is available if the previous policy has been kept active without a break. Portability thus allows the customer to carry forward the continuity benefit accrued in the current health policy. For example if under a previous policy, the condition was excluded from coverage for two years and under a new plan with a different insurer the exclusion period for the same condition is three years, the new health insurance policy can only exclude the condition from coverage for one extra year.

Procedure of Portability
You have to apply to port your health policy with the new insurer 45 days prior to the last date of renewal. The new insurance company will provide you a proposal form and a portability form along with the details of products offered. You have to submit the forms given by insurer with the chosen product details. After submitting the form from the policy holder porting in insurer will approach the porting out insurer regarding medical records and claim history. Porting out insurer has to furnish all the details within seven days of request by the new insurer. After getting all the information from porting out insurer, new insurer has to take all the decision regarding underwriting your policy within 15 day. If porting in insurer fails to take a decision within stipulated time frame then it is bound to accept the application.

Things to remember for policy holder

  • Ensure that you file your porting request at least prior to the renewal of existing health policy; else it may lead to rejection.
  • Ensure that you port the policy before the existing cover expires. In case the decision of acceptance is still pending on the last date of renewal of your existing policy, you can request your present insurer to extend the coverage for a month or more.
  • Portability is applicable for all individual health policies. In case you are a part of a family/group policy, you need to migrate to an individual policy from the same insurer and then apply for switch the insurer after 1 year.

The portability is only applicable for the sum-insured under previous policy. Cumulative bonus is transferred as increasing sum assured and you have to pay for that.

Advantages of Portability

  • Portability allows policy holder to switch to another insurer and carry forward the waiting period exclusions and pre existing disease cover.
  • Policy holder under employer’s group mediclaim can transfer the waiting period to the individual/ family health policy.
  • Insurer can not apply any extra loading on premium for porting in customers.
  • If the porting in insurer fails to respond within stipulated time frame of 45 days the proposal is bound to be accepted.
  • Portability will be helpful for the person who changes his/her city so that, so that portability will be helpful in availing network hospitals. As some insurer apply copayments in area basis, portability will be helpful for those people who are changing the city.

Benefits as well as costs structures associated with group plans on offer by companies for their employees are expected to change fairly soon. In order to reduce the cost of premiums associated with employer provided health insurance, more and more companies are now evaluating reducing the benefits on offer. So portability will be helpful for those people for getting appropriate coverage by changing to individual plan.

Portability will force the insurer to improve their service quality as well as to add more innovative products to attract and retain the customers.

Limitations in Portability

  • Customers with an accumulated claim-free bonus will not benefited as the new insurer will apply the premiums on extended sum assured.
  • Customer wants to migrate from group policy will first have to switch to an individual plan offered by their existing insurer and then after will be allowed to switch to the insurer of their choice only after a year.
  • As insurance company can reject the portability proposal, therefore typically senior citizens may not be accepted by any other insurance companies.

You have to file your request to switch insurer at least 45 days prior to the renewal of existing health policy. Though the porting in insurer is free to consider a proposal even if the policyholder fails to approach it 45 days before the renewal date of the current policy, it is not legally bound to offer portability if this criterion is not met which may lead to reject your application.

Ensure that you port the policy before the existing cover expires. In case the decision of acceptance is still pending on the last date of renewal of your existing policy, you can request your present insurer to extend the coverage for a month or more.
Maintaining documents like previous policy certificates and renewal notices so that

Maintain proper documentation such as previous policy certificates, renewal notices clearly stating continuity of coverage, etc., so that it is easier for the new insurance company to evaluate your proposal and underwrite the policy accordingly.