Policy features and poor service from an insurer often force a policyholder to think about transferring to another insurance provider. There are several reasons why an insured usually opts for portage, including better features, dissatisfaction with the current insurer, premium rates, etc. An insured can consider changing insurer at the time of renewal. If you’re considering doing this, here are some important things to keep in mind.
Only compensation plans can be transferred
“If you are considering transferring your health insurance plan from one insurer to another, make sure you have indemnity coverage. Only compensation plans can be transferred at the time of renewal and benefits such as the bonus-malus can be transferred at the time of transfer. The initial waiting period and the waiting period for pre-existing conditions are also credited at the time of transfer,” explains Vivek Chaturvedi, CMO and Head of Direct Sales, Go Digit General Insurance.
For example, if you transfer your policy after four years and the new policy has a waiting period of three years, no waiting period clause will be applied on the new policy since you have already served this period on the existing plan.
Benefits can be transferred up to the sum insured
Experts say benefits can only be transferred up to the selected sum insured on the existing health plan. “If your existing plan has a sum assured of Rs 5 lakh and you opt for a higher sum assured, say Rs 10 lakh, then the transfer benefits will apply up to the sum assured limit of Rs 5 lakh “, explains Chaturvedi.
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How and when to request portage
If you want to transfer your policy, you must request it at least 45 days before the end of the current plan. For portability to another insurer, you must complete a portability form and within 15 days, the insurer will accept or refuse your request. If your application is rejected, you can choose to renew your existing plan or purchase a new policy from another insurer.
Experts say that carrying health insurance policies is quite simple if certain things are kept in mind.
“You should know that the portability of health insurance policies is only authorized at the time of renewal. Health insurance policies of any type, whether individual or floating, can be transferred from an existing insurer to similar health insurance policies from another insurer. Benefits such as a waiting period and a no-claims bonus can be maintained even after the transfer of the health insurance policy depending on the company to which one wishes to transfer. Claims relating to previous insurance policies must be shared with the port company. In the retail policy, if one wishes to transfer, the individual must apply at least 45 days before the existing policy expires,” says Indraneel Chatterjee, co-founder of RenewBuy.
The benefits of health insurance coverage
- Policyholders have the option to upgrade their product for better features and service
- Insurers can also provide the option of combining the bonus-malus and the sum insured at the time of transfer, allowing policyholders to benefit from the advantages of a higher sum assured.
- Policyholders can get better features at competitive premium rates
Disadvantages of health insurance transfer
- Insureds can request the transfer only at the time of renewal of the existing policy
- This could lead to higher premiums
- If you choose to transfer from group plans to individual plans, some benefits that were offered in the group plan may be lost.
Portability allows customization
Along with the flexibility and freedom to transfer the insurance policy to another insurance company, insurance portability also allows for customization. A cumulative bonus can also be transferred from the existing insurer to the new insurer in the form of an increase in the amount of coverage, without any additional premium for the same.
Also Read: How Supplemental Health Plans Help You Prepare for Medical Emergencies
When not to go for babywearing
Although porting is a feasible option, consumers should only use it if there is a real need for portability. It is important to make a careful assessment because underwriting rules, policy exclusions and terms and conditions vary from one health insurance company to another. In addition, the policyholder should understand the new terms and conditions, which accompany the newly transferred insurance policy.
“The best way to know if one should go ahead with the portability option, is to check with trusted digitally-enabled insurance advisors who can guide consumers with what to do and what to do. don’ts when it comes to insurance portability and can offer multiple options among the plethora of insurance companies and relevant policies,” says Chatterjee.