Many times when a customer likes a policy of an insurance company and he buys it. But the problem arises when he learns about a new product from another insurance company that seems more suited to his needs in terms of profit, servicing, or pricing. Earlier, when such a situation used to occur, the customer had no other option but to relax. But now it is not so. Now the customer has the option of portability.
That is, he can port his existing policy to the new policy. The concept of health insurance portability was first introduced in 2011 by the insurance regulator. With the help of portability, customers can port their policy to other insurance companies and this also gives them credit for the waiting period completed during the previous policy period.
If you notice, almost all indemnity plans (compensation plans) come with certain restrictions covering certain diseases or pre-existing conditions after a waiting period of up to 4 years. Now talking about the benefits of portability, the customer can choose a new insurance company over the existing insurance company and for this he will not have to leave the waiting period completed in the previous policy.
For example, a person suffering from asthma, which is a condition already present in the insurance policy, in such a case that if he wants to move to the new insurance company, then he need not worry about that. The prospective insurance company will re-apply the waiting period on the policy for the pre-existing condition. Portability allows a new policy to be taken with the credits provided for the waiting period completed in the previous policy. Portability benefits are provided on the previous sum insured (even insured) and accrued bonus (as part of the base sum insured). The portability benefit will not apply to any other enhanced sum insured.
When a customer wants to port a health insurance policy, they must contact the new health insurance company at least 30 days before the current health insurance policy ends. After this, he has to fill a proposal form for portability, give details of the previous policy and then apply for portability. After receiving the application from the customer, the new health insurance company may contact the existing insurance company to know the medical and class history of the customer. Realizing this situation, the new health insurance company may accept or reject the proposal based on the information received and underwriting guidelines.
I would like to tell you an important point here that the new insurance company will take the request for porting the policy as a new application and it will be thoroughly evaluated. Therefore, it is very important for the customer porting the policy to take full care that there is no discrepancy in sharing the medical history while submitting the portability form. Otherwise his form may be rejected. If it is found that the client already has a disease or is suffering from a health problem that may require repeated visits to the hospital, the new health insurance company may decline the portability request.
Why customers should opt for portability
The customer should be very careful while adopting the option of portability and should choose this option only when the various benefits offered by the company are attractive and meet the additional needs in relation to the long-term health care needs of the family. For example, the insurance company has a larger network of hospitals or is offering a plan that is customized to match a chronic illness of a family member.
There are other reasons as well, due to which the focus of the customer shifts to the new insurance company. These include – poor service, inadequate coverage, unsatisfactory claims / reimbursement experience, no value added benefits, reduced policy premium for the same or more features, room rent limitations, co-payment rules, etc.
Therefore, while there may be many benefits to porting to a new policy, it is equally important to be aware of the different types of features and services offered by different insurers before taking a proper decision. Even when the policy is ported, credit is transferred for pre-existing conditions and timely exclusion. Nevertheless, it is very important for us to analyze the policy documents of various health insurance companies before applying for portability.