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A health insurance policy is a contract between an insurance company and the insured. Even though it is usually a long term contract, it is not mandatory for the insured person to continue with the health insurance company in perpetuity. The insured can easily replace his old insurance provider with a new one; This process is called insurance porting and this feature was introduced by the IRDA of India.
Let us now address some of the most important questions with respect to porting your health insurance policy:
There are a variety of reasons why a person would want to port their health insurance policy. It is possible that he or she may be getting a better premium rate, he or she may be unhappy with the customer support, or he or she may be getting better bang for their buck with another insurance provider. All of the above are valid reasons for a person to port their health insurance policy.
Let us talk about some of the most pertinent benefits in porting a health insurance policy:
Lower premium rates: The IRDA of India has created an environment of high competition among insurance companies in India. Due to this, insurance companies are constantly looking to get more customer by slashing premium rates. A policyholder can leverage this situation and look to port their policy to another insurer.
Better coverage: Similar to the tactic of reducing premium rates, insurance companies also provide additional services, perks and additional coverage to attract customers. You can take advantage of this.
Better service: At times, a customer may be satisfied with the premium rates and the coverage provided by his current insurer but he may be highly dissatisfied by the kind of service provided to him. This is where he may opt to port his policy from his current provider to another company that has a track record for providing better customer service and satisfaction.
Higher claim settlement ratio: The claim settlement ratio is the percentage of claims a health insurance company settles. For instance, if a health insurance company receives 100 claims, and settles only 95 claims, the company’s claim settlement ratio is 95%. A high claim settlement ratio should be of paramount importance while considering buying a health insurance policy.
Let’s now understand the steps of porting your insurance policy.
Once you have zeroed in on your new health insurance provider, initiate a portability request with them. Ensure that you have placed this portability request 45 days prior to the renewal date of your current policy.
The insurance company will now provide you with a portability form and a proposal form. You will need to fill-up these forms accurately and honestly and furnish them to your new insurance provider.
The insurance company will now take a maximum of 15 days to decide on your application. If the new insurance company decides to port your account, you will now have an insurance contract between yourself and your new insurer. The old insurance contract will now be terminated.
The following documents will be required to initiate a porting request:
There are 2 important points that you need to keep in mind before porting your health insurance policy, they are:
No claim bonus: It is imperative to keep in mind that your No Clam Bonus (NCB) if any is carried on from your last insurer to your new insurer. You do not want to miss out of any NCB coverage that you may have accumulated in your last insurance policy.
Coverage: Another very important aspect to keep in mind is if there is any divergence in the level of coverage provided by your old insurer and your new insurer. If your new insurance provider provides additional coverage, then that is fine but there should not be less coverage than before. Check the policy brochure and policy bond in detail before taking the leap.
Frequently asked questions
Yes, you are eligible towards insurance portability as per the IRDA of India.
You must ensure that you inform your new insurance provider 45 days prior to your current insurance policy's renewal date.
Yes, NCB is generally carried forward. But you must verify this with your new insurance provider.