Not happy with your health insurer? You can port your policy

Today, if you’re not happy with your mobile service provider, you don’t have to be tethered to poor service: you can easily port your connection to another provider. Similarly, you can port your health policies too if you are unhappy with the service provided by your insurer. The insurance regulator, the Insurance Regulatory and Development Authority of India (IRDAI), has allowed health insurance porting since 2011, but sadly many policyholders remain unaware of the ins and outs of porting a health insurance policy. We give you the lowdown.

How it works Portability is allowed in all health insurance products (both individual and floater policies). But you can shift only between two similar policies. For instance, porting from a medi-claim policy of one insurer to that of another insurance company is allowed, but not from a medi-claim policy to, say, a personal accident cover or a critical illness cover. Also, remember that porting is allowed only at the time of renewing a policy, not while it is in force.

While porting from one insurer to another, you will be allowed continuity benefit of the waiting period for pre-existing conditions — that is, you will be allowed to carry forward the time that you were associated with on the earlier policy. Say, your current policy has a four-year waiting period for pre-existing diseases, and you have already had the earlier policy for two years; if the new policy has a two-year waiting period, your pre-existing diseases will be covered from Day 1 in the new policy.

Continuity benefit is also given on ‘waiting period for specific ailments’, which is in place for claims on expenses for treatment of joint replacement, cataract, and so on.

The other benefit given to those who port their policies is the transfer of the no-claim bonus (NCB). Say your sum insured is ₹5 lakh and you renewed the policy for two years without a claim; and thanks to the NCB, the sum insured (SI) has increased to ₹6 lakh. Now, if you decide to port before renewing it for the third year, you are eligible for an SI of up to ₹6 lakh on the new policy. However, the premium will be calculated based on the higher sum insured — ₹6 lakh in this case. (If you had stayed with your old insurer, you would have paid the premium only for the original sum insured.)

Waiting periods and NCB are the only two benefits that can be transferred at the time of porting. Sub-limits on expenses, exclusions, day-care coverage and other policy features and terms and conditions cannot be ported; you will be governed by the terms of the new policy. Also, even if you choose the same SI, there is a chance that the premium may go up. This is because the pricing depends on the underwriting procedure of the new insurer.

Conditions You will be eligible to port your health insurance policy only if you had renewed it without a break. Remember, insurers are not mandated to take up all requests that come in for porting. So, there is a chance that the new insurer may reject your proposal. Also, with higher age, and new health complications, if any, the premium may be higher. If you are young (under 40) and healthy, and unhappy with your current health insurance provider or the policy, you may be better off buying a policy afresh rather than going through the hassle of porting. But if you are 40-plus, you could look at the porting option. If you take up a new policy, you may have to wait for an additional three or four years to cover pre-existing diseases and, in that time, the chances are high that other age-related medical issues may affect you.

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