Health Insurance portability and its benefits

Health insurance portability is a facility to transfer your health insurance policy from an existing company to another without many hassles

Mobile number portability (MNP) has brought about flexibility to a lot of mobile phone users who wanted to shift to a better network without having to change their numbers. Similar concept was introduced by IRDA in the health insurance domain. They call it Health Insurance portability.

What is it?

It is a facility to transfer your health insurance policy from an existing company to another without many hassles.

Also Read: Health Insurance Most Important Aspects

How to do it?

It is a pretty simple process. You need to submit a form to the new insurer stating the porting of your policy. It should be sent 45 days before your policy renewal date. The new insurer will take a decision on accepting this policy within 15 days.

What are the benefits of health insurance portability?

1)      You can change the insurer if you are not happy with the existing insurer’s service.

2)      You can choose any new individual/family policy with the new company.

3)      Benefits of the previous policy would continue to exist.

4)      Your new insurer has to insure you at least up to the sum insured under the old policy.

Few Conditions

1)      Portability is allowed only at the time of policy renewal.

2)      Submit the application at least 45 days before renewal date.

3)      The new insurer has the authority to fix a higher premium.

4)      Policy should be in continuation. The new insurance company may reject the portability if the premiums are not paid.

IRDA in its circular clarified that all insurers issuing health insurance policies shall allow for credit gained by the insured for pre existing condition(s) or critical illness in terms of waiting period when he/she switches from one insurer to another or from one plan to another, provided the previous policy has been maintained without break.

For example if under a previous policy, the pre-existing 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.

This credit (in terms of waiting period) would be limited to the sum assured (including bonus) under the previous policy. There will be a common database which all insurers will have access to. As part of this portability feature, all details including claims will be shared among the insurers. This will enable the new insurers to obtain data on history on health insurance of the policyholders who apply for portability.



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