Switch Health Insurer in Case of Gap Between What is Promised and Delivered

[Apollo Munich CEO]

Health insurance portability has had a slow takeoff since it became
operational on October 1. But industry players say with a little
discretion, customers can make good use of this facility to draw
maximum benefit from their health insurance plans. Antony Jacob, CEO
of standalone health insurer Apollo Munich Health Insurance explained
the many nuances of health insurance portability in an interview with
MoneyGuruIndia.com. Excerpts:

What are the advantages and disadvantages of health insurance
portability?

Portability is a customer centric decision that allows flexibility to
the insured member to choose between insurance brands during the
lifespan of being insured. The move is expected to enhance service
standards amongst all insurance players while increasing the level of
competitive intensity among insurers in order to retain their existing
customers. In the long run, it would be the company with better
services that will gain by winning the trust of customers.

On the flip side, it would be imperative for all insurance players to
be mindful of the possible abuse and misuses that may arise due to the
changes in the regulation. Underwriting principles of the insurance
companies should be followed with at the time of accepting any
proposal with portability requests to ensure that transition is
smooth.

One possible consequence of portability is that loss ratios may go up
as reserves accumulated for waiting periods and pre existing
conditions are not transferred equally among insurers.

Under what circumstances should you go for a portability of your
existing policy?

Portability permits customers the flexibility to switch insurers and
simultaneously protect their accrued benefits under an existing health
insurance policy. It also allows customers’ protection against
discontinuity and consequential loss of pre-existing diseases cover.

Hence, in case the customer perceives a gap between what is promised
and delivered by an insurance company in terms of service or benefits,
he or she can now move out and opt for a similar plan with other
insurer of his or her choice.

What should you look at before deciding on the new health insurer
while going for portability?

Customers should keep in mind that every policy is different and each
insurance company is governed by their underwriting principles. Hence
they should choose the one they deem fit and take an informed
decision.

The new regulations suggest the customer can choose the new insurance
plan in totality (both in terms of the premium amount, as well as the
benefits offered). Hence, it is important for the customer to
completely understand the benefits as offered under their existing
policy and subsequently match them with the plan that they wish to
port to.

We strongly suggest that once a customer takes an informed decision
and receives cover by an insurer, the person should read through the
policy schedule and policy wordings document. Like we do at Apollo
Munich, many other insurers have also started to give a synopsis
document (customer information sheet) along with the policy wordings
which would help the insured (customer) to quickly understand all the
coverage and exclusions.

We strongly suggest the customers to take an informed decision while
exercising the right to port from one policy to that of another.
Although tempting, porting to a lower premium product is not safe as
one may reduce their benefits as well as inclusions, exclusions,
waiting periods, etc while opting for a lower value products.

What if you own a unique product and you don't have a similar
alternative with another insurer to go for portability? Can you still
do it?

As per the guidelines on portability issued by IRDA, the policyholders
can port their policies to another insurer with the pre-existing
conditions and time bound exclusions; only for a similar policy
offered by the incumbent insurer. Having said that, I believe with
more than 25 companies offering health insurance plans the chances
would be very less for a customer to not being able to find a plan
that suits him the best in terms of value and service promises.

How often should you review your health insurance portfolio and what
are the things to look at?

We believe that one should review his or her health insurance policy
on the basis of benefits, exclusions and adequacy of the plan, on
renewal. Also, one should consider a review in case he or she wishes
to convert an individual policy to a family floater or to endorse new
family members on an existing plan.

With progressive age and inflation, one should consider increasing the
sum insured levels to ensure adequacy of the plan at the time of
crisis.

Lastly, how to ensure a relatively hassle-free health insurance for
yourself?

It is imperative for a policy holder to read and understand the claim
procedure laid down by the insurer at the time of buying a policy. It
helps in reducing the panic at the time of emergency. Also, we advise
customers to provide correct information related to occupation,
income, diseases, if any, while applying for insurance. Any misleading
declarations could lead to denial / delay of claim later on.

In order to avoid hassles at the time of filing a claim, the
beneficiary must intimate the insurer as soon as possible on the
insurance company’s/claim’s toll-free number, preferably before
hospitalization. The claimant should consult the call center
executives of the company while filing the claim/pre-authorisation
form, as they are well-trained to explain the right procedure for
filing the same.