I have been with the same health insurance company for six years. I am not satisfied with their service and want to switch to another insurer. I am worried that if I switch, I will lose the waiting period benefits I have already served, including for my pre-existing conditions. Is there a way to port my policy without starting the waiting period all over again?
– Name withheld on request
Yes, you can switch health insurers through the portability facility mandated by the Insurance Regulatory and Development Authority of India (). Portability allows you to transfer your accrued waiting period credits to a new insurer, including the waiting period already served for pre-existing conditions. The new insurer is required to give you credit for the years already completed with your existing insurer.
To initiate portability, apply to your new insurer at least 45 days before your renewal date. You will need to submit a portability form, your existing policy details, and your claim history. The new insurer will evaluate your application and may accept, reject, or offer modified terms.
Key conditions
A few important points to keep in mind:
- The sum assured under the cannot exceed your current sum assured without attracting fresh waiting periods. For instance, if your existing sum assured is ₹5 lakh and you opt for ₹10 lakh coverage, the waiting period waiver will apply only to ₹5 lakh. A fresh waiting period will apply to the additional ₹5 lakh.
- Insurers are generally reluctant to admit a porting request if there has been a major claim in the previous policy. It is best to explore portability with a clean claims record.
- Initiate the portability request well in advance. Even if the new insurer rejects your application, you will still have time to renew your existing plan.
I am 38 years old and bought a term insurance policy of ₹50 lakh seven years ago when my annual income was around ₹10 lakh. My income has since grown to ₹18 lakh a year. I have two young children and a home loan outstanding. I now feel my cover is inadequate. Can I increase the sum assured on my existing policy, or do I need to buy a new one? What is the best approach?
– Name withheld on request
Most term insurance policies do not permit an increase in sum assured after issuance. You will need to buy a separate additional term plan to bridge the gap. Buying a second policy alongside your existing one is common and straightforward.
How much is enough?
A standard rule of thumb is to carry of at least ten times your annual income. With your current income of ₹18 lakh and an outstanding , you should ideally have total cover of at least ₹2 crore.
After accounting for your existing ₹50 lakh policy, you need an additional ₹1.5 crore of cover. Factor in the outstanding loan amount separately and add that to your coverage requirement.
Things to remember
- You must disclose all existing insurance policies while applying for the new one.
- The insurer will assess total coverage relative to your income. As long as the combined cover is within acceptable limits, the policy will be issued without difficulty.
- Premiums will be higher at age 38 than they were at 31.
- Choose a policy term that extends to at least your expected retirement age of 60 or 65 to ensure protection throughout your earning years.