Key advantages and disadvantages of switching your health insurance policy

To protect the interest of customers, IRDAI has allowed the Portability of Health Insurance policies.

It is the right accorded to individual health insurance policyholders, including all members under family cover to shift their policy to another insurance company along with transfer of credit gained for pre-existing conditions and time-bound exclusions.

Industry experts say policyholders should look at porting their policy if they do not like it and are unsatisfied with their current policy.

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Hence, if you are not satisfied with the services of your current insurer or are looking at considering more features in your policy which are not available in the existing policy, then you can always port your health insurance policy at the time of renewal with any General Insurance or Health Insurance company without losing any of the previously gained benefits.

Note that you just need to approach the insurer from whom you wish to buy the policy at least 45 days before the expiry of your policy, but not more than 90 days.

Here are some of the Advantages of Portability;

According to Supriya Rathi – Wholetime Director, Anand Rathi Insurance Brokers, portability can be of immense help to a policyholder in the case of;

·       Dissatisfaction with the Policy servicing or Claims provided by the Insurer

·       Lack of Transparency in case of the policy conditions or clauses

·       Better and competitive offering in terms of Policy features

Time-bound exclusions in the existing policy, waiting period gained in the existing policies, can be ported to a new policy.

However, Rathi points out, “the portability option can only be exercised at renewals, and the policy should be in force without any break-in insurance.” Application to the new insurance company for portability should be made at least 45 days before the date of renewal.

The regulator has further clarified that if the outcome on acceptance of portability is pending with a new insurer, the existing policy should be extended if requested by the policyholder for a short period by accepting a pro-rata premium for such a short period. “The existing insurer should not cancel the existing policy until such time, a confirmed policy from a new insurer is received or there is a specific written request from the insured,” says Rathi.

Portability is limited to products that cover similar risks, such as basic reimbursement to basic reimbursement policies and likewise. Also, there is no additional cost involved in the case of portability. The policyholder pays only the premium opted for.

“Individual members, including the family members covered under an indemnity based group health insurance policy, has the right to migrate from such a group policy to an individual health insurance policy or a family floater policy before opting for portability,” explains Rathi.

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