Health Insurance Portability – Dos and Don’ts

Ritesh aged 39 had a health insurance policy for two years but he wasn’t happy with it. He found its claim process to be tedious and the reimbursement policies hard to understand. 

Besides, poor customer service from the insurance company left him feeling helpless. He felt stuck and wanted a way out. That’s when he heard about health insurance portability.

Do you have a health insurance policy that you aren’t happy with? You now have the option of portability just as you can now port your mobile phone to another operator.

What is health insurance portability?

Here’s an infographic on how easy it is to port health insurance.

Health insurance portability is a procedure through which you can transfer an existing health policy within the same insurance company (if your insurance company provides portability facility) or to another insurance company. Insurance porting can help policyholders switch to better options. In simple terms, it means transferring an existing health insurance policy to another company for better features and advantages or better service standards. This also keeps the health insurance companies more sensitive to the needs of customers.  

In India, the Insurance Regulatory and Development Authority (IRDA) introduced health insurance portability in 2011. Even though it has been available for almost a decade, most policy holders are not aware of this facility.

Some of the most common questions that insurance holders grapple with are: Should I port my health insurance policy? Is there an age limit for health insurance portability? How long does the porting process take? Can I port a family floater policy? How do I decide whether to port or not to port?

To answer these questions, let’s look at key factors, features, and the dos and don’ts of insurance portability.

Related: A Layman’s Guide to How Health Insurance Works

Should you port your health insurance policy?

If you’re considering porting your policy, ask yourself the reason for wanting to do it. The most common reasons for porting are: 

• Dissatisfaction with the existing insurance company. This could be due to poor customer service, poor communication from insurance agents or the possibility of an insurance merger
• Certain claims procedures may be hard to understand. For example, the policy could have different reimbursement limits for different medical situations, making the process complex.
• The limitation of a policy to solve yours or your family’s healthcare requirements. For e.g., a low insurance value, non-coverage of hospitals and health centers at your location, among others.

 

Why and when should you go for health insurance portability?

For better options: If another insurance company offers a better policy compared to your current policy, go for porting, provided the switch cost is not too high. 

Hidden clauses in the current policy: You may come across hidden clauses in your existing policy. If you’re not comfortable with certain clauses, look for a new insurer.

Need for additional cover: With age and increasing medical needs, you might want a policy that offers additional coverage. If your current policy doesn’t offer it, consider health insurance portability. 

Customization or specialized services: Insurers may offer customized policies to meet specific individual or family needs. If your current insurer cannot offer specialized services required by you, look for a new insurer. 

 

Health insurance portability – the process

The process of porting depends on individual cases and the underwriting principles of the insurance company. Here are the key steps:

1. The policyholder must, before 45 days of the expiry date of the policy, inform the existing insurer requesting a shift to a new insurer, apply for portability to the new insurer and ensure the policy is shifted without any break in the timelines. 
2. The new insurance company will provide a portability form, a proposal form and information on various health insurance plans.
3. The policyholder must fill the forms with the correct information and submit them.
4. From here on, the process is taken over by the existing insurer and the proposed insurer. The existing insurer will provide the insured’s details and claims history to the proposed health insurance company. The new company will feed in the details through the IRDAI portal.
5. The proposed insurer has to underwrite the insurance policy within 15 days or reject it. If there are discrepancies, the insurer may choose to reject the application and has to inform the insured within 15 days.

Documents required for health insurance porting

• Health insurance policy certificates of previous years
• Latest documents or notices mentioning renewal dates and coverage continuity
• Self-declaration in case of no-claim
• In cases of claims made, investigation reports and discharge summary
• Proposal form and portability form

 

Dos and don’t of health insurance portability

Dos

Start the porting process before the existing policy expires

A policyholder can apply for portability only around the time of the renewal date of the said policy; not at any other time. Moreover, the application for porting must be made at least 45 days before the renewal date of the existing policy. 

Compare insurance coverage offered by different insurers

If you’ve decided to shift to a new insurer, make sure you choose the best option available. Compare insurance options from different insurance companies. You could do so with the help of an insurance agent or even through comparative insurance syndication websites

Make sure the old policy is canceled

Once the new insurer approves your porting request, make sure the old policy is canceled. For the new insurer, your policy is a new application. The onus of cancellation of the old policy is on the policyholder.

Transfer bonus accrued to the new policy

Make sure you understand the terms and conditions related to the benefits and bonus accrued from the existing policy. Different insurance companies may have different conditions. It is your  responsibility to ensure you do not lose any money or benefits in this process.

Gather all the required documents

Find out the list of documents required by your new insurance company and keep them ready. At times, you may have to request certain documents from your current insurer, which may require time.

Port only if the differential benefits are convincing

All policies have their pros and cons. Consider health insurance portability only if the benefits of the new insurance plan are compelling or solve a specific problem with the existing insurer. For example, always choose a policy that covers both hospitalization and daycare procedures. If your current policy covers only one, insurance porting is a good option.

Don’ts

Don’t miss out hidden costs

Make sure you ask all the right questions related to the costs. For example, some insurers may charge more premium or additional loading on premiums. This cost must be factored in.

Don’t conceal important information 

The new insurer will scrutinize your application and gather all your data from the existing insurer. Do not hide information such as pre existing diseases, as it may lead to the rejection of your portability request. Remember, health policies are issued on good faith with the clear understanding that you have disclosed all material details pertaining to your health.

In a nutshell

Health insurance portability is a blessing for policyholders. Its advantages definitely outnumber its limitations, but it is essential to understand the details before opting for it. Now that you are much better informed on insurance portability, are you considering porting anytime soon?