Health Insurance Portability Option: A Comprehensive Guide

At times when a provider is not able to satisfy the customer with proper services or fails to deliver the care that was promised, a policyholder decides to go forward with another service provider. At such an instance, certain concerns like the risk of losing out on the premium amounts that have already been paid or monetary investments that have been made into the insurance become imperative for any individual to contemplate before going forward with portability. The IRDAI has thus proposed new guidelines which make it easy for an individual to avail the portability option, in case they face a dissatisfactory service.

In line with this, here’s your complete guide for go with the process of health insurance portability!

When Should One Consider Portability?

Any insurance should prove helpful at times of emergencies, or when someone is facing a tough financial constraint. If the provider is not able to meet the demands of the customer, the very reason for pouring out money into the policy goes in vain. The service is supposed to be prompt and fool-proof to aid an individual during emergencies successfully.

Improper services like- inadequate coverage, slow or delayed response to claim requests, reimbursements that are due, sudden inflations, minute clauses in documents, and insufficient hospitalisation covers etc. are some of the reasons why an individual might not be content with the insurance provider. These become the causes for reconsideration of an on-going policy or plan that the person has. Even having found a better insurance plan, which enables a person to make more savings, or provides more tax benefits, can be influential while deciding whether to shift to a policy from any other insurer.

Advantages of Portability

When an individual opts for a different plan, many new possibilities open up for the betterment of the situation.

• New Nominees: The customer can avail additional benefits and personalise the inclusions as per the demands, and also extend the policy for the protection of more loved ones, by adding on to the beneficiaries they have previously mentioned.
• Added Bonuses:An individual can benefit from bonuses, no-claim reimbursements, and savings from their previous plan and can have them added for the new plan.
• Lesser Costs:To expand their services, companies often offer minimal individual rates and inexpensive insurances, as well as cashless mediclaim facilities.
• On-going Benefits:The advantages of the previous plan are continued in the new policy, and the grace period/free-look periods are considered even at the time of new agreements.
• Sum Insured:The new insurance company has to provide the individual with a sum insured at least equal to the previous amount; this can also be upgraded depending upon the bonuses earnt in the previous plan.
• Portability of a plan within the existing insurance company is permitted.

Things to be Mindful of

There are certain things to be considered in terms of portability:

• The bracket under which the insurance company falls cannot be shifted to a different bracket. For example, to port a plan under a general insurance company, the individual needs to select another similar kind of an insurance provider.
• Before porting to a new policy, the individual must ensure that the previous policy was consistently renewed over the duration of the plan, and also that the recent renewal is not pending.
• Many companies require prior notice for porting to another company in writing, mentioning the cause of such a decision and also the details of the new insurance provider.
• For being eligible for portability, the person must receive a response to their application for the same in no later than a week.

Transferring from a Floater Insurance to an Individual Policy

If an individual is willing to take insurance apart from the one provided by their employer or company, they can easily do so. But they would need to first opt for any other plan provided by the same insurance provider which their employer has been using.

After the completion of 12 months since the purchase of the new plan, the individual is able to finally avail the portability option and shift to another policy, offered by another provider, after studying the peculiarities and clauses of the same.

*Kindly review the terms and conditions of the policy-related documents carefully before the purchase.

Understanding the Denial of Your Portability Request

The insurance company you are applying to holds the complete right to deny the request or the application submitted for portability, given that there are certain discrepancies regarding the paperwork or within the formalities.

Such a denial can be made on the basis of:

• Submission of improper details, or incomplete forms
• Not being able to submit the required documents within the deadline
• Questionable frequency of claims that have been made in the previous policy
• Notable variations in the on-going policy and the plan the individual wishes to shift to
• Inability to provide documentation regarding the last insurance, accounting for at least the previous 3-4 years
• Inconsistent renewal history pertaining to the previous insurance plan
• Retirees and aged individuals often face difficulties in portability due to the deviant set of pre-requisites involved in their plans
• Critical illnesses, blood pressure issues, blood sugar problems, etc. can become the grounds for rejection, as these ailments can experience sudden surges

*Acceptance or denial of portability requests is subject to the underwriter, who also holds the authority to decide upon the terms of the policy.

Required Paperwork for the Process

The application for portability requires a set of documents that need to be submitted within the given deadline, to be able to go through a smooth and risk-free process, and complete the formalities with as little hassle as possible.  

The required documents are:

• Recent documentation and certificates from the on-going plan
• Record of the latest policy renewal
• A notice stating the clauses for the continuation of the covers and bonuses
• All documents that have been submitted in case of a claim settlement
• Application stating the reason for opting portability

How to Go About the Process?

On the demand of portability, the new insurance provider offers a portability form and also the consent form for the proposal, along with the adequate documents and brochures in order for you to get well acquainted with the features of the diverse plans provided by the company.

After a careful and detailed review of all the available policies, the individual needs to decide upon the plan they wish to go ahead with and accordingly fill up the forms for submission.

The submitted forms and documents are then verified and thoroughly cross-checked, for any mal-presentation, or the need for any investigative procedures.

The previous company should follow up with the information regarding the previous plan of the individual on the official IRDA database within a week. Failure in the completion of this step would lead to the suspension of the applicant’s request.

The last step of this process is the acceptance or denial of the request by the insurance provider, which has to be intimated within 2 weeks, by the end of which, if the individual does not receive any notification, the provider cannot deny the portability request.

Final Word!

Portability stands for the right accorded to policy to transfer the benefits gained by the current insured for NCB, pre-existing conditions and waiting period clause if the one wishes to switch from one health insurer to another. So, if you want to switch your insurer, do it in a proper way keeping the aforementioned pointers in mind!