How to Port Your Health Insurance Policy ?

What is Porting in Health Insurance?

Imagine you have got a health insurance policy for a few years now. You raised a claim under your policy last year. Your health insurer rejected the claim amount citing that the condition was not covered under your policy. You were not happy and escalated the matter to IRDAI and after the intervention of IRDAI, your claim was paid by the insurance company 6 months later. 

Though your claim was settled by your insurer, the process of claim settlement left much to be desired. You are not happy with the way your insurer handled the claim situation and do not want to renew the policy next year with the same insurer. 

In this situation, you can port or transfer your health insurance cover to another insurer of your choice. Now IRDAI protects your rights as a policyholder by allowing you to port your health insurance policy to another insurer at the time of renewal. Porting from one insurer to another is a great option as it allows you as a policyholder to enjoy continuity benefits even after moving to a new insurer or plan.

Benefits of Porting Your Health Insurance Policy

If you are not happy with your current health insurer for whatever reason, porting your health insurance policy is a great option. Portability option is open at the time of renewal and you can exercise it at any renewal.

Enjoy Continuity Benefits: Portability is better than buying a new policy altogether as it comes with some continuity benefits. You enjoy continuity benefits on standard waiting periods such as initial waiting period, waiting period for named illnesses and waiting period for pre-existing diseases (PEDs). 

Suppose you bought a health insurance policy 2 years back with a 2 year waiting period for named illnesses and 3 year waiting period for pre-existing diseases. Now after having spent 2 years under the same policy, you port your policy to a new insurer who has come up with a plan with much better features. 

New health insurance policy also has waiting periods of 2 and 3 years for named illnesses and pre-existing illnesses respectively. Since you have already spent 2 years in the old policy, your waiting period for named illnesses is served. You will not have to serve any waiting period for named illnesses under your new plan after porting. But the waiting period for pre-existing illnesses under your new plan is 3 years and you have only spent 2 years under your old policy. So here also you will enjoy the continuity benefit and serve only one more year of waiting period for pre-existing illnesses under your new plan after porting. 

How to do Porting of Health Insurance?

Portability of health insurance is an easy process. 

Step 1: Select the insurer and the plan you wish to migrate to well in advance. 

Step 2: Apply for portability 45 to 30 days before your renewal date.

Step 3: Provide all your previous policy details along with each years’ policy copies, pre-existing diseases and claim details, if any.

Step 4: Your new health insurer will decide whether to accept your proposal or not based on its underwriting guidelines and details provided by you.

Disadvantages of Portability

All good things come with some limitations and so does portability of your health insurance policy.

Underwriting Process

As your new health insurer would underwrite your case again, it might not accept your proposal to port your existing health cover. This will depend on your existing health conditions and past claims which you have made under your existing policy. In such a situation, you might try with some other insurer or even consider sticking to the same health insurer. 

Loss of Accumulating Benefits

While you enjoy continuity benefits on waiting periods in case of porting, you tend to lose out on accumulating benefits such as no claim bonus (NCB). If you started a policy with the initial sum insured of Rs. 5 Lakh in the first year and got another Rs. 5 Lakh cover as no claim bonus (NCB) in the second year, you have a total cover of Rs. 10 Lakh in the second year. Now if you port your policy to another insurer at the start of the third policy year, you will again have to start with a sum insured of Rs. 5 Lakh. You lose out on the no claim bonuses (NCB) accumulated over the first 2 years with your old insurer. If you wish to match the cover with what you would have had along with no claim bonus (NCB) under your old plan, you have to opt for a higher sum insured and pay extra premium for it. 

Conclusion

• Portability allows you to migrate or transfer your health insurance cover from one insurer to another at the time of renewal.
• Portability is a great option. It protects your rights as a policyholder as it comes with continuity benefits on waiting periods. 
• If you are not happy with your current health insurer or want to move to a new feature-rich plan, you can opt for portability.
• But use portability with caution as it means loss of accumulating benefits like no claim bonus (NCB). There could be underwriting issues as well at the time of porting.