IRDA issues guidelines on portability of health insurance

People who have subscribed to health insurance policies can now change providers without having to fear losing benefits of a 'no claim' track record or on concerns of having to wait for a while before certain health conditions are covered.

According to the insurance regulator, insurers must allow policyholders transfer of credit in terms of waiting period for pre-existing illness and bonus sum insured from one insurer to another.

The Insurance Regulatory and Development Authority (IRDA) yesterday issued guidelines on portability of health insurance which will come into effect from 1 July, 2011 and would be applicable to life and general insurance companies.

Under the new guidelines, medical policyholders would be able to switch insurers like mobile phone service providers from 1 July this year.

The insurance watchdog has also issued guidelines for portability of health insurance policies, instituting a system that offers flexibility on pre-existing diseases. The system would also assure hasslefree service to those with transferable jobs or a penchant for changing employers.

However, the Insurance Regulatory and Development Authority (IRDA) has not specified the premium to be paid when one policyholder moves to a different health insurer. According to some insurance industry sources this could mean different premia across services.