What is Health insurance portability?
Term Health Insurance Portability allows a person to shift from one Health Insurance Company to another without losing the benefits of current health insurance provider.
What are the reasons for its induction into the system?
Insurance Regulatory Development Authority (IRDA) introduced health insurance portability due to following reasons:
- To improve service and delivery in the insurance industry.
- When a person relocates from one position to another there is lack of insurers premises offering policy services in the region.
- When a person changes his job, he might lose the health insurance cover facility.
According to this feature, a policy holder can shift from one insurer to other without the fear of losing the PED cover.
What are the features of this scheme?
This unique feature Health insurance portability was implemented from July 1,2011. The main highlight of this scheme is the portability that allows switching to other companies without any loss. This is useful for those people who are not pleased with the services that are being provided or their health insurance policies.
It is beneficial for people who are:
- Suffering from pre-existing illnesses.
- People who are eligible for bonuses and are forced to continue with their existing policy companies.
- For people moving to another state where the present policy provider does not work.
Benefits from the customer point of view:
Carry forward the waiting period:
You can carry forward the waiting period of the pre existing diseases to the new insurer.
For example let the new policy covers a pre-existing disease only after the three years, but you may be in the possession of another insurance policy of 2 years. In that case, portability will help you to wait for just one year for the claim.
No waiting Period:
Whenever you buy a new policy, there is a waiting period of 30 days and the diseases that are occurred in this period are not covered under this scheme. According to this policy, the waiting period is waived off.
What do you need to look out?
These are the conditions that you must consider while switching your policy:
- Maximum Renewability Age: If a policy do not allow you to renew after a certain age, you must consider switching to a policy with maximum possible renewable time.
- Exclusions: There are some of the omissions in each policy and if the same is included under some other policies then you can consider switching.
Impact of Portability on overall insurance industry:
This scheme has brought an overall positive change in the insurance industry. The insurance companies have welcomed this change. It brings out the higher competition level among the health insurers to attain the existing consumers.