What are the Reasons Behind Porting a Health Insurance Policy?

There are several reasons behind the tendency to port a health insurance policy. These include better coverage at the same amount of premium, a significant change in life, restrictive policy clauses, a bad claim experience with the existing insurer, or poor customer service.

Let's look at the following sections for a detailed explanation of each point.

Better Coverage for the Same Premium

Sometimes, you explore a better or higher coverage at the same premium you pay for your existing health insurance plan. In such a scenario, you may want to avail the portability feature.

Health insurance companies introduce several new products with improved features or lower premiums over time. Porting your policy is a good way to access these benefits. You can potentially enjoy better coverage at the same cost.

Significant Event in Life

Another crucial reason why policyholders tend to port their health insurance plan is the occurrence of a remarkable change in life. For example, marriage and children. These life events may create a need for a higher sum insured or broader health insurance coverage.

However, according to the Insurance Regulatory Development Authority of India (IRDAI), the biggest advantage is that you don’t have to lose the benefits you have gathered over time. You can carry forward the benefits, such as the waiting period for "Pre-existing Diseases".

Restrictive Policy Clauses

It is another reason behind shifting the health insurance policy. What is a restrictive clause in insurance? Let's look at a few examples. Suppose your current insurer does not have a wide hospital network, or certain common medical conditions are not covered under the policy.

Or they may have room rent limitations of ₹5,000 per day, and you need to get admitted to a hospital room costing ₹8,000 per day. Then you have to pay the difference out of your own pocket. Another example is a co-payment clause, which requires you to pay a fixed percentage of the hospital bill.

Such restrictions often trigger policyholders to switch to another insurer that offers more flexible terms and comprehensive coverage.

Bad Claim Experience with the Existing Insurer

Another very common reason behind porting a health insurance policy is that you had a bad experience during the claim procedure. It could be anything: delayed claim settlements, claim rejections, repeated requests for additional documents, or a lengthy and complicated claims process.

When the overall claim experience is less than satisfactory, it often motivates policyholders to look for an alternative insurer so that they do not have to face similar hassles during future claims.

What Crucial Factors Should You Keep in Mind While Porting A Health Insurance Policy?

To avail the portability feature of health insurance effectively, you need to keep some factors in mind:

Timing

You can not port anytime in the year. As per the IRDAI guidelines, porting must be initiated at the time of policy renewal. You should request your existing insurance company and apply to the new insurer at least 45 to 60 days before your current policy expires.

Underwriting Risks

The new insurer will evaluate your current health condition, age and claim history. They have the right to accept or reject your application based on your medical history.

Thinking about additional charges for portability? Fortunately, you don't have to pay any fee for porting your health insurance policy.