Still stuck to your old health policy? Here's why and how you can port it

Delhi-based Ritesh Singh didn't like the reimbursement limits for different medical procedures in his existing health insurance policy. The 36-year-old then decided to port his existing health insurance policy to another/new health insurer. With the existing health insurance company, he had a 4-year-old policy with a sum insured of Rs 2.5 lakh, which included a cumulative bonus of Rs 50,000. "I called my insurance agent and he told me that I can easily make the switch to a new health insurer with the same sum insured (not less than that) without losing any benefits I have had accumulated with the previous insurer. He also told me that I can port a sum insured of at least Rs 2.5 lakh and if I want to increase the sum insured while switching the policy, I can do that too," said Singh.Singh went to a new health insurer to get some more clarity on portability as there were many things he was unclear about. It was then he found out that the insurance agent had not told him that the insurance benefits carried forward from his existing policy would be capped up to Rs 2.5 lakh (the sum insured which he was getting with the existing health policy) when he ports his policy to the new health insurer. And, any sum insured above that will be treated as new/fresh sum- insured which would be treated as a new policy in terms of benefits provided by the new health insurance company.Singh had been thinking that if he ported his policy to another health insurer with additional sum insured, the new insurer would provide some additional benefits. Hence, before applying for portability Singh took detailed advice from the new health insurer. The new insurer informed him that if the insurance company to which he is porting to does not have a policy with the exact sum insured of Rs 2.5 lakh, then he will have to opt for the nearest higher sum insured available to them, say Rs 3 lakh. "So, in this case, you will get full continuity benefit for Rs 2.5 lakh to the extent of waiting periods served in the previous policy (say 4 years in Singh's case) but you will not get the benefit on the enhanced sum insured to, say, Rs 50,000. For this balance of Rs 50,000 we can also apply for a waiting period of 4 years for pre-existing disease, however, this can vary from plan to plan," explained the new health insurer. Nevertheless, you can even go for a higher sum insured than what the new health insurer is providing but again, you will get no additional benefit on the increased sum insured. Also, there are certain terms and conditions which you need to fulfill to get higher sum insured, else the insurer can reject your application.After getting to know about what health insurance portability means, Singh eventually applied to switch to the new health insurer.Here's the process of porting policy When you want to port your health insurance policy, you need to approach the new health insurer at least 45-60 days before the expiry of your existing health insurance policy. Once you are there, you need to fill a proposal form for portability, details of previous year policy copies and then apply for portability. On receipt of the request, the new health insurer will approach the existing insurer to know your medical and claims history. Understanding the situation, the new health insurer can accept or reject the proposals based on the information received and the underwriting guidelines.Once the new health insurer obtains all the details, they have to take a decision on whether or not to accept porting of the policy within 15 days. If the insurer fails to do so, they will have to compulsorily accept the application.Nikhil Apte, Chief Product Officer, Royal Sundaram General Insurance told EconomicTimes.com that the company post evaluation on the various medical underwriting parameters can reject, accept the case or accept the case with a fresh waiting period that can be applied on the additional sum insured if opted by the insurer. Also, when a policyholder opts for portability, medical underwriting happens on the current health status of the policyholder and not how the policyholder was when he purchased the policy for the first time. Basis the current health status, the policyholder may be subjected to co-pay (It is a fixed amount paid by an insured for covered services) or loading premium (increase in the premium amount). "Let's say you bought a policy 4 years back, but you didn't have diabetes or thyroid at that point. But at the time of porting, it is found that you are suffering from diabetes or thyroid, then in that case, we can suitably apply loading or co-pay to the ported policy," said Apte.You should also know that you may have to shell out more premium after switching your policy to another health insurer as explained above. Therefore, you should figure out the reasons why you want to port your policy before doing so. When you should think of portabilityIt might be confusing for you to decide when to go for health insurance portability and move to another policy. Therefore, to make this situation easy, you need to analyse the reason why you need to port.Mahavir Chopra, Director - Health, Life & Strategic Initiatives - Coverfox.com says that one should be careful and opt for portability only when the differential benefits offered are compelling and solve an unsolved need with respect to your family's long-term healthcare requirements. "For instance, a health insurance plan that offers a better restore benefit or may be in cases when an insurer has a larger number of hospitals under its network or some plan that is customised to a chronic illness that one of your family members suffer," he said. These reasons can help you understand more about when you should ideally go for portability. Vaidyanathan Ramani, head, Product and Innovation, Policybazaar.com said that porting should be preferred when you are not satisfied with your current insurer's service/claim payment on a genuine case or coverage or features being offered in another product are of more personal value. "However, you should look at porting only if you have not had a difficult history of claims as any issue that is seen to persist in the future will diminish the chance to get portability," he added.When you start getting poor services: It might happen that your health insurance company over a period of time may not provide you with better services and doesn't live up to the promised quality of service. "Younger consumers today should opt for portability or change in the insurance plan, only when they are offered an alternative insurance plan that is offering differential benefits. Slightly older consumers should look for a change when they are unhappy with the service/claims experience," said Chopra.When an existing insurer is not giving you additional cover: If your existing health insurance provider is not able to provide you sufficient cover against any specific health issues which are of a concern to you then in such a situation you should look at porting your policy. Apte said the existing insurer may not have a higher sum insured the customer is seeking or may not be comfortable giving a higher sum insured due its underwriting capability limitations. "Some companies focus only on sum insured up to Rs 10 lakh, while they may not have 50 lakh sum insured available or they may not be comfortable giving that higher sum insured in a particular channel and/or geography while the another insurance company may be open to it and can have better underwriting practice for risk selection," he said.When you get better option from competitors: You may get a better deal in case of age caps for renewal, policy premium, limits on room rent, or co-payment clauses, etc. Due to stiff competition, there are chances where you can avail same services at a cheaper premium price. When transparency in policy document becomes an issue: At times there may be some hidden clause which you may not be aware of while buying the policy. However, when it comes to making claims, these clauses may become a major concern during emergencies. Therefore, in that case, you can consider shifting to a provider who is transparent in their policy documents.Things you should considerThe nature of the policy you wish to port remains same before and after porting, that is, if it was an indemnity plan then it will remain as such and cannot be converted into a defined benefit policy by porting to a new insurer. Obviously, you can port a policy (say indemnity plan) to another insurer only if the latter provides policy options of similar nature, i.e., indemnity plans. "Defined benefit insurance plans cannot be ported," said Apte.The new insurer will consider the porting request as a fresh application and a complete evaluation will take place. Thus, it is important for you to ensure that there is no lag or discrepancy in sharing medical history while submitting the portability form to avoid rejection. The new health insurer can deny the portability request if you have a pre-existing disease or have any health conditions such as diabetes, high blood pressure, heart related ailments which require frequent hospital visits. Wrong or incorrect information and non-availability of previous policy documents can also lead to rejection of a portability application. Ashish Mehrotra, MD & CEO, Max Bupa Health Insurance said that the details of the policyholder such as medical records, claims history is provided by the existing insurance company to the new health insurance company. "The insurer further extracts your details within seven working days through a common data sharing portal which is developed by IRDAI to ensure that the given information is correct," he said.Make sure that you are aware of the different kinds of features provided by various insurers. "While porting the existing policy, it is possible for you to transfer the credit gained for pre-existing conditions and time-bound exclusions. Hence, analyse the policy documents of various health insurers carefully before applying for portability," said Mehrotra.

from Economic Times http://bit.ly/2WZ7g1L