Health Insurance Portability Explained

Pros and Cons of Health Insurance Portability

As per the new IRDAI (Insurance Regulatory and Development Authority) Guidelines, you can port from one insurer to another, and you reserve the right to transfer the credits gained so far with your existing policy. But policyholders are often sceptical about their medical insurance portability decisions and hence, like to weigh the merits and demerits of such a decision. So, let’s check out the pros and cons of transferring your policy to help you make informed decisions.

Pros And Cons of Health Insurance Portability

Advantages of Health Insurance Portability

Talking about the advantages of a health insurance portability, we have -

• Customisation: Using the customisation feature of a health insurance portability, you can modify the policy as per your health conditions and lifestyle preferences. Examples include adding fresh nominees, opting for an additional cover, and the like.
• Continual of Benefits: You will continue receiving the benefits of your existing plan after porting to another insurer. Moreover, you don’t need to worry about time-bound exclusions while making portability requests.
• New Sum Insured: The existing amount will be merged with NCB (No Claim Bonus) or any other bonus credits amassed while estimating the new insurance sum.
• Improved Service: One of the primary reasons for switching is better services offered. You can opt for an insurer who provides high-quality support service and gives full attention to the customers.
• Improved Claim Settlement: If the claim settlement process of your current insurance provider is slow enough to cause you substantial financial imbalances, you can always switch to a provider that reimburses claim amounts, on time.
• Competitive Premiums: It is most likely that you will receive all the benefits of your existing policy at lower premiums due to high competition amongst insurance companies.
• Transparency: You can always move to a provider that delivers transparent services and policies without keeping any hidden terms and clauses. It also ensures that no additional or unauthorised charges are levied at a later stage.

Disadvantages of Health Insurance Portability

Despite the above benefits, there are some negative aspects of porting a health insurance policy, which include -

• Time-Bound Process: You can opt for health insurance portability only when the renewal date of your current policy is approaching. If not, you need to wait until then.
• Higher Premiums: Additional benefits in the new policy might cost you higher premiums.
• Similar Policy Options: Your options for choosing new varieties of products are limited. In other words, you can only select from similar types of policies and won’t get the option to switch to a different one.
• Loss of Benefits: If you plan to port from group plans to the individual ones, you might end up losing some benefits you are enjoying with your current policy.

Health Insurance Portability Rejection Reasons

IRDAI has given insurance providers the authority to reject a policyholder’s portability request on the grounds of specific terms and conditions, including:

• Document submission delays.
• Inadequate or invalid information submitted.
• Breaks in policy renewal or premium payments.
• Having a poor claim history, primarily when multiple health claims are raised within a short time period.
• Presence of major differences between exclusions, inclusions, and other benefits between your existing plan and the new policy to which you wish to port.
• Not submitting previous policy documents. So, ensure that you reserve at least your last 3-years policy documents.

Conclusion

In a nutshell, policyholders are free to take advantage of the health insurance portability option if they find some other insurer more suitable for them. However, you must go through the terms and conditions thoroughly before signing the deal. Consider the cons you might have to face and accordingly port, only when you are ready for those.

In the end, what matters is the benefits and above all, the services your insurance company is providing. It’s the matter of your’s and your family’s health, so choose wisely!

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.