Choice is always good. In a globalized world, consumers have an abundance of choices in everything from airlines to cars. This is why today even airlines make an announcement after passengers land: “We know you have a choice. Thanks for flying with us!”
It’s pretty simple. You have a choice – if you don’t like the product or service, switch! The same also applies to health insurance. In India, people have become aware of the promise of health insurance, which has led to a proliferation of health insurance providers across the board. Because of this wide variety available, the policyholder does not have to stick to an insurance company if they are dissatisfied with the services.
The Insurance Regulatory and Development Authority of India (IRDA) has a new scheme for dissatisfied policyholders to switch providers: health insurance portability. What do we mean by this? Let’s explain in more detail.
What is health insurance transferability?
Health insurance transferability is the way in which a health policyholder can transfer his/her existing policies from the current provider to a new one. Portability offers customers a way to choose a better service and product. For example, an insurer cannot take them for granted.
Reasons for porting
When and why would you transfer health insurance to another provider? Here are some tips to help you decide:
o Quality of service
If you find that the standards of service offered by a policyholder don’t match what they promised when you signed up, it may be time to move on. Often an insurance company promises the moon while getting a client on board in the eagerness to close a deal, but gradually reality sets in and the client realizes it was all bullshit. There’s no point in continuing a bitter relationship, right?
o Increased benefits
There may come a time when you realize that the coverage your current health insurance provider is not providing you with is not enough, and after speaking with them, it seems clear that that is the best they can do. Under the given circumstances, it may be wise to switch to a provider that can offer the additional coverage/benefits.
There really is no point in paying more for a service/benefit that is available at a much lower price from a competing provider. If you think the competition is offering a better product at a lower cost, it’s time to make that switch.
Health insurance is offered by both general health insurers and specialized health insurers. If you feel that your current provider focuses more on non-health policies, switching to a specialist health insurer may be a better fit for you.
When you move to a new city, you should have the same services and coverage as before. But your existing insurance company may not have such better access or as many network hospitals in the city. It may then make sense to transfer to a provider that has these services in your city.
o Claim settlement
This is important. Some companies take ages to approve a claim. Before you find yourself in such a situation, it is important to know if your insurer has such a reputation. If so, port out.
Often there are hidden clauses and conditions in the contract that the policyholder is not aware of. Such hidden clauses pop up in emergency situations and you don’t know where to go. Time to switch to a provider with more transparency in their dealings.
Now that we have a good idea of when to opt for portability, it’s also important to know the benefits. What does a policyholder provide? Well, here it goes:
While switching to a new provider, it becomes easier to adapt the features to one’s specific needs and requirements. You can add nominees and even opt for additional coverage or benefits.
If you change health insurer, there is no reason to lose the entitlements you accrued with your previous provider. According to IRDA, your new insurer must give you the benefits you accrued with the previous insurer.
New insured amount
IRDA says your new insurer must insure you at least up to the amount insured under the old policy. In most cases, the existing insured amount is added to the accrued supplement to obtain the new insured amount. The No Claim Bonus is also added to the new insured amount.
Better service, affordable premiums, transparency Transferability removes the inconveniences associated with your previous health insurer, which made you switch in the first place.
Yes, portability is a major benefit for health insurance policyholders who are unhappy with their current insurer. But it is also important to know the conditions and criteria for transferability.
Terms of portability
1. The policy is only transferable at the time of renewal. The new insurance period starts with the new company
2. Apart from waiting period credit, all other terms of the new policy are at the discretion of the new insurance company
3. The process must be started by the policyholder at least 45 days before the renewal:
o Write to your existing provider and request a shift
o Indicate to which new insurer you wish to transfer your policy
o Ensure the policy renews without interruption (there is a 30 day grace period if the transfer is in progress)
In short, if you are disappointed with your health insurance, portability is a good option that offers redress – provided the above conditions are met. Now let’s get into the most important part.
How to port?
o Application for transferability must be made on the transferability form at least 45 days prior to the renewal date of the existing policy
o The company will then send you your transferability form and all policy-related documents
o The new insurer decides on the acceptance of the policy within 15 days
Other documents include all previous policies, claims experience, proof of age and others. If any other documents are required, the new insurance company may ask for them.
… One more thing!
These are some little tips that go a long way in making sure the transition is smooth and happy:
1. Read all terms and conditions, product features and brochures of the new company before making a decision
2. Know that the new company may decide to increase the premium in its sole discretion
3. Check the claims settlement ratio
4. Needless to say, check for good customer support and service