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Phalguna Jandhyala
G. Naga Sridhar

Hyderabad, Jan. 12 If you have a health insurance policy with a cover below Rs 1 lakh, you may soon be able to enjoy portability of your policy from one insurance provider to another.

The General Insurance Council (GIC), in a crucial meeting held recently, favoured the portability for policies below Rs 1 lakh and formal guidelines to this effect would be sent to the Insurance Regulatory and Development Authority (IRDA) soon, Mr M. Ramadoss, Chairman, Oriental Insurance Company and member of GIC, told Business Line.

Under present norms, a policy holder is given health cover for a year which has to be renewed every year. If there is no claim, the policy-holder is entitled to a bonus in the form of an increased sum. In addition, the bonus gets accumulated for every claim-free year.

The accumulated bonus is not carried forward after the expiry of the term, if one intends to switch over to a new firm. GIC, however, favoured a cap on the limit of cover for portability. “A portable health insurance product cannot have unlimited coverage. It has to be standardised product with a minimum cover that can be underwritten by all the companies,” he said.

The portable cover would be available for a three-year period initially. The council would also recommend that the scheme be applicable to those in the age group of 18-40. The benefits of the cover would be standardised across companies which would have the freedom to fix their own premium rates.

Mr S. Narayanan, Managing Director and Chief Executive Officer, Iffco-Tokio General Insurance, said that they hope to get the clearance from the regulator and launch products from the beginning of the next fiscal. “The regulator is very much in favour of this and is working with the Council for the past couple of months on the issue,” Mr J. Hari Narayan, Chairman, IRDA, told this newspaper.

As of now, IRDA allows flexibility for general insurance companies on new products. “It will also be made applicable to the forthcoming health insurance products,” he added.

More Stories on : General Insurance | Regulatory Bodies & Rulings | Health

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