Switching Health Insurance Companies should become easy!

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Recently, we came across news of a judgement in an online Publication, news.yahoo.com

Switching Health Care Provider

New Delhi, June 13 (PTI) Mediclaim policyholders, who are not satisfied with the service of their existing service providers, will be able to switch to another insurer soon without any change in the premium outgo. However, this facility will be available to those policyholders who are insured for a sum of Rs 1 lakh and above, to begin with

The policyholders will be able to switch their health insurance providers with the same benefits retained once they have bought this cover. At present, a policyholder is given health cover for a year and the same has to be renewed every year.

To read the full news, click here

Experts from Medimanage.com give their opinion:

KS Sankar:

KS Sankar from Medimanage.com

Don’t see much value in this.

Pl don’t get me wrong. I see huge value in portability. It’s just that I don’t see much value in the Council contemplated portability.

Even as of now, quite a few private players offer much wider portability – due to business considerations, of course. It is easier to convert the converted. Read, it is easier to poach on PSU health policy holders than reach out and cover the uncovered masses. And if you want someone who has a PSU health policy to migrate to you during health insurance renewal, you need to have portability.

The key words are ‘widen the cover’. Will the widened cover be wide enough to match the wide open portability existing with private players now? My serious doubts on this are validated by a later set of key words ‘accumulated bonus is not carried forward’. Somehow every time I read it, I read it as ‘even accumulated bonus is not carried forward’ though the word even is not physically there. I would believe carrying the bonus forward is a minimum portability requirement.

The concept of guaranteed minimum covers is being carried in by the Westerly winds. What lands on Mother Earth and what remains in the winds needs to be seen.

Sudhir Sarnobat:

Sudhir Sarnobat from Medimanage.com

This is a good news for all those Mediclaim members who are not happy with the services of their current company. There could be broadly three reasons why one would like to shift a policy.

  • After a claim, the renewal premium is hiked by the insurance company disproportionately which may dissatisfy the insured member wherein he/she may feel that just because he/she made a claim in expiring policy year, their Mediclaim premium is increased heavily.
  • They may not be happy with the actual claim processing (denial, short payment or abnormal delay in payment) which actually is a function of a Third party Administrator but as the retail Mediclaim buyer does not have choice of selecting the TPA, they may change the insurer.
  • The services during the renewal may not be satisfactory. This again is a function of an agent but if you have experienced bad service by an agent, one generally tends to change the insurance company & not just agent.

The portability would help the consumers but the rules need to be clearer. We also believe that like Terrorism Pool, a portability pool should also be set up & the qualifying cases should be paid from such pool than by the insurer which would bring in better consumer orientation & reliability.  

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