IRDA (Insurance regulatory Development Authority) had received many representations from consumer associations and policy holders for enabling portability of health insurance policies from one insurer to other insurer. Persons who are shifting from one place to another are put in disadvantageous position due to lack of insurers’ office providing necessary policy servicing at the new location. Further, the employees who are shifting from one employment to another are losing health insurance cover due to lack of portability of the health insurance policies. So IRDA considered it essential to protect the policy holders against discontinuity and consequential loss of Pre Existing Diseases (PED) cover by making the health insurance plans portable across the insurance companies. The portability will help the policy holder gives the freedom to choose his own insurer with the fear of losing the cover of PED.
So from 1.7.2011, Health insurance portability is allowed. The main features of portability are:
- This will be applicable to all existing and new policies.
- Insurance companies are to allow policy holders to carry forward the credit gained for PED in terms of waiting period when holder switches from one insurer to another or from one plan to another provided the previous policy has been maintained without a break.
- If the policy results into discontinuance because of any wanton delay by the insurer in accepting the proposal, insurer should not treat the policy as discontinuance and allow portability.
- IRDA had asked all insurance companies to share the data base within seven working days including the claim details of the policies where the policy holders had opted for portability with their counterparts provided such counterpart insurance companies request the transferor insurance company for the same.
- The insurance companies should acknowledge the applications for portability within three working days.
- One condition is there that only policy holders upto the age of 65 years can migrate under this common portable health insurance product from one insurer to another.
- The accepting insurer shall provide cover at least upto the sum assured in the previous insurance policy.
- This system is similar to motor insurance policies where portability allowed from one insurer to another.
C.R. Venkata Ramani