Consumers won’t be able to take the advantage of higher coverage if they change their insurers under portability
Consumers would be eligible for coverage only to the extent of pre-existing health insurance after portability scheme is introduced by IRDA, according to industry sources. J Hari Narayan met CEOs of the general insurance companies today at Hyderabad and discussed various issues concerning portability. Insurers were seeking clarity on a number of issues like methods of premium loading, consistency on product coverage and sharing of data.
Consistency of portability was a major issue raised by the insurers. Therefore, the insurance regulatory body made it clear that if a consumer moves from insurance company A to company B, he would be eligible for the cover (sum assured) only to the extent that he held with company A. In other words, he will not be eligible to take advantage of higher coverage provided by the new insurance company. The underwritings of the consumer will be decided by the new insurance company (insurance company B).
Health insurance is still not profitable for general insurers and they are incurring losses in this segment. IRDA is expected to announce guidelines for portability tomorrow.