Shantanu, a 40-year-old professional, is suffering from asthma. He listed this health issue as a pre-existing condition while buying health insurance. After two years, when the insurance provider raised the premium, Shantanu decided to shift to a new insurance provider. However, he was worried that the new insurer might treat him as a new policyholder and impose a waiting period for the pre-existing condition.
In this situation, the Insurance Regulatory and Development Authority of India (IRDAI) and its health insurance portability scheme came to Shantanu’s rescue. The guidelines on the portability of health insurance policy enabled Shantanu to shift to a new insurance provider without losing the benefits accumulated with the present insurer.
What is Health Insurance Portability?
The IRDAI introduced health insurance portability in 2011. Through portability, a policyholder can carry forward the credit accrued for pre-existing conditions and time-bound exclusions while switching from one insurance provider to another or from one health insurance plan to another. The policyholder also qualifies for all continuity benefits, like free medical check-ups and no-claim bonuses acquired during the previous insurance policy.
How to Apply for Health Insurance Portability?
A policyholder can apply for porting a health insurance policy only at the time of renewal, which ensures that the new period of insurance will be effective with the new insurer. Any policyholder can apply for the portability of his/her existing health policy only if it is maintained without any breaks.
- To port an insurance policy, the policyholder has to submit a written application to the present insurance company to shift the policy to a new insurer.
- The application should be made at least 45 days prior to the policy renewal date, mentioning the name of the insurance company to which the policyholder wants to switch his/her policy.
- Once the insurance company receives the insurance portability application, it provides the policyholder with a proposal form and a portability form.
- The present insurer then shares the details of the insured person with the new insurer via a common IRDAI portal for sharing customer data.
- Once the new insurance company gets all the details, it has to make a decision about underwriting the insurance policy within 15 days. Failing to respond within 15 days will force the insurer to accept the portability application.
List of Documents Required for Porting a Health Insurance Policy
Given below is a list of documents you need for porting your health insurance plan-
- Policy certificates of previous years
- The latest notice of renewal mentioning coverage continuity and other details
- The policyholder’s self-declaration in cases of no-claim
- Investigation report, discharge summary, and other equivalent documents in cases of claims
- Filled in proposal form and portability form
What is the Benefit of Porting a Health Insurance Policy?
Health insurance portability offers numerous advantages that make it an attractive option for policyholders:
- Improved Coverage: Policyholders can switch to a different policy that provides broader coverage and features.
- No Loss of Benefits: Retain accrued benefits like waiting period credits and no-claim bonuses.
- Cost-Effectiveness: Find a more affordable policy without compromising on essential benefits.
- Customisation: Opt for a plan that aligns better with your current lifestyle and healthcare needs.
Health Insurance Portability Rules
A few rules of health insurance portability that you must know are-
- Advance Notice: Policyholders must apply for portability 45-60 days before policy renewal after informing their previous and new insurance provider.
- No Denial Based on Age: Insurers cannot deny portability solely based on the age of the policyholder.
- Information Sharing: The current insurer must provide necessary information to the new insurance company within 7 working days of making the request.
- Standard Process: All general and health insurers registered with IRDAI must comply with portability guidelines.
- Additional Charges: While porting does not involve fees, the premium may increase if the amount insured after porting is higher than the previous insurance.
- Insurer’s Decision: Whether to validate or reject your policy rests with the new insurance provider.
Rejection of Health Insurance Portability Requests
In case a policyholder fails to submit the above-mentioned documents on time, the IRDAI has given the insurers the right to reject a health insurance portability application. A portability request may also get rejected due to inadequate information, poor claim history, and breaks in the renewal of policy.
Another major factor that may lead to the rejection of health insurance portability is the higher age of the policyholder. While people in the age group of 60-70 have some chances of portability, applications from people above the age of 70 have a high chance of rejection. When it comes to portability requests from senior citizen health insurance, insurance companies apply severe underwriting rules, charge higher premiums, and may even introduce a co-pay clause.
Thus, it is advisable to furnish all the necessary details to the insurer and keep the required documents ready before submitting the application for the portability of a health insurance policy. This will prevent your application from getting rejected and, hence, will make the process smooth and hassle-free.
Common Reasons to Opt for Health Insurance Portability
Many policyholders choose to port their health insurance plan due to dissatisfaction or a need for better coverage. Common reasons include:
- Better Policy Coverage: If an insurance provider offers more comprehensive coverage with lucrative add-ons, customers might be inclined to leave their previous policy for better benefits.
- Affordability: Customers may change their insurance provider if they find better coverage for the same or lower premium.
- Customer Services: In a few cases, poor customer service by the previous insurer or a promise of better customer support with the new insurance provider may lead the buyer to port their insurance.
- Change in Location: If the customer is moving to a geographical location not covered by their current policy, they will change their insurer for one that provides wider coverage.
- Lifestyle Changes: People may consider upgrading to a policy that suits new health or lifestyle needs with advancing age or health conditions.
- Policy Flexibility: Better add-ons, flexibility in premium payment, and health insurance plans with inclusions and exclusions that fit a person’s needs are also common reasons people opt to port their insurance.
Things to Consider Before Porting a Health Insurance Policy
Porting a health insurance policy is an important decision that requires careful assessment. Keep these things in mind:
- Policy Comparison: Compare the features, benefits, and premiums of the new policy with your existing one.
- Continuity Benefits: Ensure that benefits from your previous health insurance plan, such as waiting periods and no-claim bonuses, will be carried forward.
- Network Hospitals: Check the network hospitals covered by the new insurer for cashless treatment.
- Terms and Conditions: Review the policy document thoroughly to avoid surprises later.
- Hidden Charges: Be wary of any additional fees or hidden charges that might apply.
- Policy Requirement: Learn about prerequisites such as health checkups and document verification your new insurance provider needs to prepare yourself for all formalities.
FAQs on Health Insurance Portability
- Can I port health insurance online?
Yes, you can port your health insurance online by going to the website of the insurance provider.
- Do I need to pay extra charges for porting my health insurance?
You may need to pay a minor fee at the time of porting your health insurance. The premium cost depends upon the new insurer and the type of plan you are buying.
- What is the difference between migration and porting in health insurance?
When you buy a different plan with the same insurance provider, it is called migration. If you change your insurer, it is known as porting.
- How long does it take to port a health insurance?
It takes 15 to 45 days to port a health insurance plan once you have submitted the application and documents to the insurer.
- Does portability apply to group health insurance policies?
Yes, group health insurance can be ported to an individual health insurance policy under certain conditions.
- Will I lose my no-claim bonus if I port my policy?
No, your no-claim bonus will be carried forward to the new policy.
Conclusion
Health insurance portability enables the policyholder to switch their insurance provider to one that best meets their needs. Always research different insurers in the market before starting porting your policy. Your careful planning will ensure that porting your health insurance plan becomes a positive step in better insuring your future.
Disclaimer: The information provided in this blog is for educational and informational purposes only. It is not intended as a substitute for professional advice, diagnosis or treatment. Please consult a certified medical and/or nutrition professional for any questions. Relying on any information provided in this blog is solely at your own risk, and ICICI Lombard is not responsible for any effects or consequences resulting from the use of the information shared.