Bangalore-based Atul Sharma was extremely annoyed with the reimbursement limits of his health insurance policy that he bought six years back from a known insurance agent. Recently, Atul finally decided to port his existing health insurance policy with a sum insured of Rs 5 Lakh, which included a cumulative no-claim Bonus of Rs 1,00,000 to another insurer who could offer him better and smoother services. He aggressively searched online and was happy to know that he could easily make the switch to a new health insurer – that too with an enhanced sum insured without losing any benefits which he had accumulated with his previous insurer.
From 2011, the Insurance Regulatory and Development Authority of India (IRDAI) permitted consumers to port their health insurance policies if they were dissatisfied with the services of the current provider. However, one must know that all porting requests are put through the underwriting guidelines and it is entirely the insurer’s prerogative to accept or reject a port-in request.
Need for porting your insurer
While searching for a new insurer, Atul learnt that porting to a newer and better insurance product is always helpful as insurance products have rapidly improved and evolved over the last few years. What you may have bought a decade or even 5-6 years ago may likely be overpriced and outdated, considering current day requirements. Moreover, many insurers are now encouraging porting by waiving minimal requirements such as additional medical tests or the need to complete detailed forms. All that insurers ask for to process your claim request is a declaration of good health, existence of pre-existing conditions and claims history. While porting your insurer may mean access to better products and services, it is important for you as a customer to rightly disclose your medical history to the new insurer when making a porting request. Porting is never a way to hide your medical conditions and claim a larger insurance benefit.
When you decide to port your existing policy to a new insurer, there are a handful of things that you need to know for a smooth transition. If you choose to get the sum insured enhanced when porting your health policy, there is a cap that insurers apply on certain procedures. Take the example of Atul. While porting his insurer, he chose to increase the sum insured of his policy from Rs 5 lakh to Rs 10 lakh. Now, while there will be no capping on the initial Rs 5 lakh sum insured while making a claim through the new policy, the insurers will apply a waiting period on the enhanced limit, i.e., Rs 5 lakh. In case of hospitalisation due to accident, there will be no waiting period. However, for regular hospitalisation, there will be a waiting period of 30 days. Further, for claims related to pre-existing conditions, while there will be no waiting period up to Rs 5 Lakh. On the additional Rs 5 Lakh, there will be a waiting period of four years.
Here's the process for porting your policy
When you decide to port your health insurer, the first thing that you need to follow is to approach the new health insurer at least 45-60 days prior to the expiry of your existing health insurance policy. Customers can port a policy until a day before expiry, and need not do it on the last day. Upon submitting a request, the insurer will ask you to fill a proposal form online for portability, which will include details of the previous year’s policy copies. Once the new insurer receives the required documents, the insurer will approach your existing insurer to get updates on your medical and claims history. Once the new insurer receives all the required details, the insurer takes a final decision on whether or not to accept your porting request within 15 days.
Customers must know that medical underwriting happens on the current health status of the policyholder and not based on the details of policy when it was purchased for the first time. Considering your current health conditions, the insurer may apply loading in case of an adverse medical history, or place temporary exclusions or apply a waiting period of 2-4 years on a pre-existing disease. Therefore, it is always advised that you choose a health insurance policy that offers both hospitalization and day-care procedures without any sub-limits. Remember that all the policies are different from each other and are governed by their underwriting principles. If not, look around and find one that offers all the possible benefits. You should choose the one you deem fit.