Consumers can port their health insurance midway: Here is what they must do

New Delhi, Oct 8, 2024

Using the option could result in delays in claim settlements as new company will familiarise itself with your medical history

The health insurance industry sells a variety of products: From those assisting in basic hospitalisation covers to comprehensive plans that include dental care or yoga sessions.

What do customers do when they find a policy no longer serves their needs? Is it possible to jump ship midway?

Switching your health insurance policy midway through a term is generally not allowed. Most insurers instead offer the option to switch or port benefits only at the time of renewal. During the renewal period, it's essential to evaluate your current coverage and assess your health needs, said Sharad Bajaj, chief operating officer of InsuranceDekho.

Here are rights consumers have if they want to port an insurance policy:

You can port your policy from and to any specialised health insurance company.

You can port any individual/ family policies.

Your new insurer has to give you the credit points relating to the waiting period for pre-existing conditions that you have gained with the old insurer.

Your new insurer has to insure you at least up to the sum insured under the old policy.

The two insurers should complete the porting as per the timelines prescribed in the Insurance Regulatory and Development Authority of India.

Once the new insurer receives the portability application, they are required to respond within 15 days.

What happens when you are porting a policy:

You must request a shift to your new insurance company at least 45 days before your current policy's renewal date. In your request, include the name of the company you wish to transfer to. Keep in mind, aside from the waiting period credit, all other terms, including the premium, are subject to the discretion of the new insurer. Ensure your policy is renewed without interruption, though you have a 30-day grace period if the porting process is still ongoing.

When considering an alternative, It is always advisable to the policyholders to compare their current coverage against new offerings, focusing on aspects like waiting periods, exclusions, and network hospitals. Portability, a relatively new feature in health insurance, has made it easier to carry forward accrued benefits like waiting periods to a new insurer without starting over,” Pankaj Nawani, CEO, CarePal Secure.

Best alternatives while switching your plan

When considering a switch, several factors come into play. Here are some of the best alternatives and why they might be suitable:

Comprehensive health insurance plans

These plans offer extensive coverage for hospitalisation, pre and post-hospitalization expenses, and often include additional benefits like maternity coverage, OPD expenses, and preventive health check-ups.

Family floater policies

Family floater plans cover multiple family members under a single policy, often proving more cost-effective than individual policies.

Critical illness policies

These policies provide a lump sum payout upon diagnosis of specified critical illnesses, offering financial protection against severe health conditions.

Top-up plans

These plans offer additional coverage over and above your base policy at a relatively low cost, effectively increasing your overall sum insured.

Disease-specific plans

For individuals with specific health concerns or family history of certain diseases, these plans offer targeted coverage.

Factors to consider while switching your policy

Waiting periods: When you switch a policy, you may have to serve a new waiting period for pre-existing conditions or specific treatments. Some insurers may waive waiting periods if you're switching from a similar policy, but this isn't guaranteed.

Continuity benefits: If you switch to a new insurer, you might lose accumulated benefits like no-claim bonuses. Some insurers offer portability, allowing you to transfer certain benefits.

Premium changes: Your new premium could be higher or lower, depending on factors like your age, health condition, and the new policy's coverage.

Coverage differences: Ensure you understand any changes in coverage, network hospitals, or claim processes when switching policies.

Timing: It is often advisable to switch near your policy's renewal date to avoid complications with pro-rata premiums or gaps in coverage.

Disclosure: You must disclose all pre-existing conditions and your medical history to the new insure.

[The Business Standard]