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Words of Wisdom : "Money is not the most important thing in the world. Love is. Fortunately, I love money." ~ Jackie Mason

Should You Change Your Health Insurer?

Once upon a time, you had to bear with the utterly poor services of a telecom operator. It was not convenient to change your mobile number (at least not very often). With number portability, this became history.

Not happy with your existing insurance company? 

No problem! Go ahead and switch to another company.

The same benefit of portability is now available, for your health insurance policies too. You are no longer at the mercy of the health insurance providers. 

Earlier, if you were not satisfied with your existing insurance company, you had no option but to discontinue the old policy and buy a new one from another insurer. There was no concept of switching an existing policy.

This had a very serious drawback:

As you would be aware, there is waiting period of usually 2 to 4 years before the pre-existing illness get covered under a typical health insurance plan.

As such, earlier due to starting afresh with a new policy, this benefit of waiting period was lost. You had to start from zero again. 

With health insurance portability, this major deterrence to switching is gone. Now the period spent under your existing policy, with the previous insurer, will be carried forward to the new insurer. For example, if you have had your old policy for 2 years and the new policy stipulates a waiting period of 3 years, your pre-existing illnesses will be covered after one more year only.

Thus, you can now make your policy switches without any loss of benefit.

In fact, apart from the unsatisfactory service standards, there could be other reasons for making the switch. This may include: 
- You want to buy a policy that offers life-long renewal, instead of the present one which has maximum age specified for renewals
- The new policy is offering much wider coverage of illnesses and ailments.
- Network of hospitals, in your present policy, does not serve your purpose.
- New policy may be available at a lower premium.

Beware:

You must carefully evaluate the health insurance plans offered by various insurers. Unfortunately, as on date, there is limited standardization and hence there could be vast differences among various policies. It shouldn’t so happen that you move from frying pan to fire. 

In fact, given the many issues involved in health insurance portability, it makes sense to consider it only if the expected benefits are significant. Changing insurers for trivial matters is not recommended.

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