Health insurance is insurance against the risk of incurring medical expenses among individuals. By estimating the overall risk of health care and health system expenses, among a targeted group, an insurer can develop a routine finance structure, such as a monthly premium or payroll tax, to ensure that money is available to pay for the health care benefits specified in the insurance agreement.
When Rajeev, currently working with an MNC, decided to switch jobs, he was also concerned about shifting the group medical coverage that his present organization offered to an individual policy. Besides being largely unaware of the portability norms with regards to insurance in India, there were other relevant queries and terms that he was unaware of when he decided to shift.
There are several queries that need to be addressed: What are the norms of porting froma group insurance cover to a personal policy? Can you carry forward the waiting period accumulated over time? Can you shift to a different insurer?
If you are in a similar position as Rajeev, here is a quick glance at a few facts related to shifting from a group medical cover to a personal policy.
What are the Basic Conditions of Switching to an Individual Policy?
Since a group medical policy underwrites a group, the norms are more relaxed. So you can carry forward the waiting period that you have accumulated for pre-existing conditions when you switch your insurance plans.
However, the important factor to remember here is that when you plan to shift policies from a group cover to an individual policy, you can only do so with the same insurer. You can only switch insurers when you have completed at least one year with your individual policy with the present insurer.
You can also shift policies if your entire family is covered by it. You can choose individual policies for each family member or opt for a family floater cover.
Will Your Waiting Period be Carried Forward?
Usually, in a group health insurance there are no waiting periods and you get coverage for pre-existing conditions from the very first day. However, as per the IRDA you are eligible to carry the credit gained for pre-existing conditions in the form of a waiting period.
One of the major advantages of shifting policies nowadays is that your waiting period is not wasted. However, if your group insurance policy has a waiting period and you have served a certain time period for it, it will be carried to your new individual policy.
What is the Procedure for Porting?
Firstly, you will need to fill out a form in order to port from one policy to another. Once your form is duly filled, you have to provide the details of your policy, your medical history and declarations (if any) alongside. Certain insurance providers might also ask you to take a few medical tests.
Also, it is important that you submit your form for porting at least 45 days prior to your renewal date.
Following the processing of the application for porting, the insurance provider underwrites the new policy and the terms and conditions associated with it along with the new premium. This is ideally done within 15 days. Once the premium is paid by the insurance holder, the new policy begins.
You must note that you will only be able to avail the benefits of portability if your previous policy has been carried forward without interruptions.
What are the Benefits of Shifting to an Individual Health Cover?
An individual insurance policy gives you a more comprehensive coverage than a group coverage would. You can choose a customized policy to suit your needs. Since you do not have to worry about the waiting period expiring, it makes the shift easier as you can carry forward the policy benefits.
Also, you can enhance the cover when you shift from one health insurance plan to another. In that case, however, the benefits of the waiting period will only apply to the existing sum assured and not the new sum assured.