Health Insurance Portability: Thins to Know

Health Insurance Portability

The Insurance Regulatory and Development Authority introduce Health insurance portability in 2011 to transfer existing policy to a new health insurance agency. Rising medical expenses have made it necessary for everyone to invest in health insurance policies that promise maximum coverage at nominal premiums. For this it is important that you must compare health insurance plans before buying them. Often, health insurance companies bring out new health insurance products or modify existing ones to attract more customers. Customers then opt for new plans introduced by other insurance companies. However, there may be many other reasons to switch from existing health insurance plans to plans sold by other health insurance companies. While the idea of porting your policy from one insurer to the other may seem like a tedious experience,but it is not so difficult if you compare health insurance plans briefly and have all the documents required.

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Health Insurance Portability:

Portability from one health insurance policy to the other is possible if both the policies provided by both the health insurance companies are indemnity plans that allow the policy holders to visit any doctor or get admitted to any hospital for treatment purposes. Policyholders do not have to worry about losing out on benefits like no-claim bonus or get through another phase of waiting period that they had already covered with their health insurance service provider.

Apart from the documents required for health insurance portability, your choice to port your policy from one insurer to another is regulated by certain guidelines. They are:

Duration of Notice Period:

You must apply for portability at least 45 days prior to the expiry date of your existing insurance policy, but not before 60 days before the expiry date of the policy. However, your new health insurance provider may reject your application if the nature and quantum of risk involved is not at par with its underwriting policy.

Acceptance Period of the Insurance Proposal:

It is the responsibility of the new insurance company to respond to the request of insurance portability within 15 days of the proposal receipt. If, for some reason, the new insurance company delays in processing of the proposal, thus, affecting the renewal of your old policy, then the new insurance company is liable to request your existing insurance company to keep you insured for a short period up to a month from the due date. The premium for this period would be charged by your existing insurance company on pro-rata basis.

Right to Reject:

The new insurance company has the right to accept or reject the proposal depending on its underwriting norms. If you had shown no signs of pre-existing illnesses and have therefore made no claims on the policy, it is quite likely that your existing insurance company would charge you nominally. However, during the proposal, if you have been diagnosed with any critical disorder, the new insurance company not only has the right to charge additional amount of premium, but also to reject your proposal altogether. In such instances, policyholders can reconsider their decision to return to their old insurer while their application for portability is being processed.

Continuity of Existing Policy:

The application for portability of health insurance must be made before the expiry date of the existing insurance policy. To enable smooth portability, it would be prudent to have in place all documents required including renewal notice and policy certificates. 

Summary:

Most people tend to ignore important aspects other than premiums charged when they compare health insurance plans before investing in them, which can prove costly in the long run. Policyholders must keep in the mind the nature and kind of coverage they require when they compare medical insurance policies apart from the other benefits inherent in each policy. You should also know about car insurance policy before choosing any auto insurance agency.

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