Definition
Health Portability
Portability lets a policyholder switch their health insurance to another insurer while retaining accrued continuity benefits such as waiting-period credits.
Under IRDAI's portability framework, a policyholder dissatisfied with their insurer can move to a new one at renewal without losing the time already served against pre-existing disease and other waiting periods. The request must be initiated well before renewal (commonly 45 days prior).
The new insurer can still underwrite the proposal and may decline or load the premium based on health, but it must credit the continuity already earned for the equivalent sum insured. Portability gives policyholders bargaining power and discourages insurers from neglecting renewing customers.
Related terms
- Waiting PeriodA waiting period is the time after a health policy starts during which claims for specified conditions or treatments are not payable.
- Pre-Existing Disease (PED)A pre-existing disease is any condition, ailment or injury diagnosed or treated before buying a health policy, typically subject to a waiting period.
- Moratorium PeriodThe moratorium period in health insurance is the span of continuous coverage after which an insurer cannot challenge a claim on grounds of non-disclosure or misrepresentation, except for proven fraud.
Plain-English explainer from The Dispatch Investors Encyclopedia. General information, not financial advice.