Health insurance portability: How to control your health insurer
Most people tolerate bad service from their health insurers because they don’t want to lose out on the benefits of the existing policy if they move to another insurer. So far, switching insurers has meant that you are considered a new customer and have to go through the requisite waiting period of one to four years after buying the policy in order to cover your pre-existing diseases.
However, from 1 October, health insurance portability will come into effect and you will be able to switch insurers without having to worry about losing the benefits of your existing policy. So, if you have an illness that will be covered after three years and have already completed two years with an insurer, you will only have to wait for a year with the new insurer for your illness to be covered.
What is allowed :
Portability is applicable only to health insurance policies issued by non-life insurance companies. If you are covered under a group mediclaim, you too can migrate to either an individual health insurance policy or a family floater plan, but only if you have been with the same insurer for at least a year. This feature will be beneficial for employees (and their families), who do not have any health plan other than the mediclaim provided by their employer. It will be especially handy when they change jobs.
You will not be able to switch insurers at any time and can apply for portability only 45 days before renewing your existing policy. The new insurer will give you a portability form, which you have to submit along with the proposal form (see 6 Steps to ensure portability).
Your details will be shared by your existing insurance company and the new one through a Web portal that theInsurance Regulatory Development Authority (IRDA) will be launching soon. Based on the details shared, the new insurer will underwrite its proposal and inform you of its decision within 15 days. If the insurer crosses this deadline, it will have to accept the proposal submitted by you.
However, the new insurer has the right to deny you the policy based on its underwriting policy. For instance, if the maximum entry age for the new insurer’s health policy is 60 years and the policyholder is 65 years old, the application for portability could be rejected.
You could also remain stuck with the old insurer if you have had too many claims or are considered to be in the high-risk category, such as a senior citizen. Also, as the new insurer can write the proposal according to its own guidelines, the premium could be very high in some cases, and you may not be willing to pay it.
If you do not receive the proposal from the new insurer till the renewal date of your existing policy, you can extend it by paying the pro rata premium for a short period to your existing policyholder and ensure that your policy is not cancelled.
Source:[ET]
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