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FAQs on Health Insurance Portability

Health insurance in India is rapidly growing and evolving. New insurers and many innovative products have completely transformed this sector over the last few years.

However, as I had earlier cautioned, you must do a thorough analysis before you decide to switch your health insurance company [Must Read:'Should you change your health insurer'].

Accordingly, having made an informed decision to do so, here's how you have to go about it.

What does health insurance portability mean?
As per the IRDA guidelines on Portability of Health Insurance Policies, it means changing your health insurance policy...
... either from one insurance company to another, or from one health plan to another plan offered by the same insurer
... along with the credit gained in terms of the waiting period typically required for the pre-existing conditions and time-bound exclusions
... provided you have been maintaining your existing policy without any break

What is a break in the policy?
If you haven't paid the renewal premium on your current health plan, on or before the policy renewal date, it is considered as a break in the policy.

Which policies can be ported to a new insurance company?
All individual health insurance policies (including family floater policies), issued by the non-life general insurance companies or the specialized health insurers, can be ported.

What happens upon portability?
Except for giving you the credit for the period for which you have maintained your old policy and a cover of at least upto the insured amount in the old policy, the premium and all other terms & conditions of the new policy shall, henceforth, be at the discretion of the new insurer.

For example, if you have a 2-year old policy and the new policy has a three year waiting period for a particular medical condition, you will become eligible for the same after one year. 

How to apply for portability?
You have to submit your Proposal Form along with the Portability Form to the new insurance company.

In addition, you have to write to your existing insurance company requesting for a shift in your policy, specifying the new insurance company to which your policy has to be ported.

When to apply for portability?
Portability can happen only at the time of policy renewal, not in-between. You are required to furnish all the necessary paperwork at least 45 days prior to the date of payment of renewal premium under your existing policy. IRDA has allowed a grace period of 30 days when the porting is in process.

What timelines do the insurance companies have to follow?
Firstly, the insurance companies must acknowledge the receipt of your application for portability within 3 working days.

Thereafter, the final decision to port or not should be communicated with 15 working days of receiving all the necessary details. If this is not done, the insurance company loses its right to reject your portability proposal.

Concluding, don't change your insurer merely to save on the premium. More important are the terms of the policy such as diseases covered, exclusions, waiting period for pre-existing illnesses, renewability, limits / sub-limits, network hospitals, etc.

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