All You Need to Know About Health Insurance Portability

Ayushi took a health insurance in Bangalore in 2019 and luckily didn’t have to encash it that year. Next year she moved to Mumbai and fell ill during the first wave of Covid 19. Unfortunately, she couldn’t locate a network hospital in her new city and desperately wanted to apply for Insurance Portability. With the help of Insurance Portability, Ayushi was able to port her health insurance policy with a local network of hospitals at her disposal.

Buying good health insurance involves thoughtful planning and careful comparison of various plans available. But often policyholders are compelled to move from one insurer to another. The most common ground for policyholders to change their insurer is to move towards a higher sum insured or better features. To ensure a hasslefree portability procedure for policyholders and safeguarding their interest, the Insurance Regulatory and Development Authority of India, or IRDAI has laid down certain guidelines. The purpose of these rules is the betterment of policyholders and protection of their interests.

What is Health Insurance Portability?

In October 2011, the IRDAI introduced the Health Insurance Portability and Accountability Act. Health Insurance Portability is one of the many provisions by the IRDAI that allows policyholders to switch their policy from one insurer to another while retaining all its benefits.

Earlier, policyholders had to face several difficulties like waiting periods for pre-existing diseases or no claim bonus, if they wished to switch their insurer. Sometimes pre-existing policyholders were even regarded as new policyholders by the new insurer. But the portability rules laid down by IRDAI has changed this to a great extent. These new rules have enabled policyholders to opt for an insurer of their preference without worrying about losing their benefits. Some of the most basic rights of policyholders are as below:

• Policyholders can port to individual or family floater health policy.
• Policyholders can port policy to and from any general insurance company or specialized health insurance company.
• Policyholders will get benefits from the new insurer on the waiting period for pre-existing conditions gained with the old insurer.
• Policyholders will get insured by the new insurer at least up to the sum insured under the old policy. However, they can also opt for a higher sum insured, subject to terms and conditions.

To experience hassle-free portability of your policy, keep these points in mind during the process:

• The terms and conditions of the health policy may be different for different insurers. It is essential to understand them clearly.
• There are some IRDAI rules to which one must adhere. For instance, a written application must be submitted at least 45 days before the premium renewal date to the existing insurer.
• Policyholders must provide complete information without any delays in furnishing documents. 
• Poor claims history is a reason that may cause problems during portability requests.
• A lower premium is a point that encourages policyholders to consider policy portability. Yet, this may lead to the insurer reducing their coverage amount, and policyholders might end up spending more. Hence, the premium and policy coverage are critical factors to consider when porting policies.

By opting for the portability of health insurance policy, policyholders can expect to gain numerous benefits apart from their accrued benefits and bonuses getting transferred. These benefits come in the form of upgraded policies, attractive premiums and enhanced services. With a good track record of processing claims in a hassle-free manner, Insurance companies enable policyholders to port their health plans based on their age segment and health status as per the underwritten rules.