Steep rise in premium, poor claim experience? Consider porting your policy

Check for loopholes in coverage, like sub-limits, and evaluate whether you need to augment coverage through a super top up policy

Harsh Kumar (name changed on request), 54, a resident of Bengaluru, recently undertook a review of his financial portfolio. While evaluating his health insurance coverage, Kumar, who has a Rs 25 lakh cover since 2012, realised that his premiums had increased by two-and-a-half times over this period. Now, he is keen to move to another insurer that offers more cost-effective coverage. 

While most people review their investment portfolios annually, many do not conduct the same exercise for their insurance portfolios. Let us go through the key checks you need to run to see if your health coverage is comprehensive (in terms of what is covered) and adequate (in terms of the sum insured).

 

Is the sum insured enough?

 

Healthcare inflation in India runs at around 14 per cent. If you bought a health insurance policy, say, five years ago, the sum insured on it may not be adequate to cover rising costs. Consider increasing the sum insured at the time of policy renewal.

Start with a base cover of Rs 5–10 lakh in your 20s and upgrade before you turn 30. “If you are under 30, plan your health insurance cover with an eye on your 50s and beyond, when hospitalisation risks typically peak,” says Aayush Dubey, co-founder and head of research, Beshak. He adds that there is no guarantee you will be able to enhance coverage at an older age, especially if health problems emerge. Locking in a higher cover while you are healthy ensures access to protection without restrictions.

The sum insured should also be revised at important life stages. “Life events like marriage or childbirth can increase healthcare needs, warranting an adjustment in coverage,” says Ashish Yadav, head of products and operations, ManipalCigna Health Insurance.

 

Buy a super-top-up?

 

Someone seeking more security may consider buying a super top-up with a deductible equivalent to the sum insured on their base policy. “A super top-up is often a more cost-effective option as it provides additional coverage beyond the specified deductible amount at a lower premium compared to increasing the base policy’s sum insured,” says Yadav. He warns that if the base policy lacks sufficient coverage for everyday medical expenses or has a high co-payment clause, it may be wiser to enhance the base policy.

Dubey recommends buying a super top-up from the same insurer from which you have purchased the base policy. “This ensures smooth integration with your base policy. Claim processing becomes easier as both policies follow the same terms. The possibility of conflicts or delays gets reduced,” he says.

 

Who should go for a critical illness cover?

 

At the time of review, the case for purchasing a critical illness plan should also be considered. “Individuals with a family history of serious illnesses (such as cancer, heart disease, etc.) may benefit from these plans as they provide a lump-sum payment upon diagnosis of covered conditions,” says Yadav. He adds that those in high-risk occupations or with lifestyles that increase susceptibility to critical illnesses should also consider this policy.

 

Is there a case for reducing the sum insured?

 

In most cases, reducing the sum insured of your health insurance cover is not advisable due to health care inflation. In rare situations, however, it might make sense. “If the rising premium of your base policy makes it unaffordable, consider reducing the sum insured on your base policy while adding an affordable super-top-up policy to maintain overall protection against large medical bills,” says Dubey.

 

Check for gaps in coverage

 

Besides reviewing the amount of coverage, it is important to assess whether your policy offers robust coverage. Understand the coverage details: the treatments and conditions that are included and, more importantly, those that are not.

The policy should include hospitalisation, daycare treatments, and pre- and post-hospitalisation expenses.

Sub-limits affect a policy’s effectiveness. “Check if your policy has any sub-limits for specific treatments or room rents, which could affect the amount you can claim during hospitalisation,” says Yadav.

Checking the insurer’s network of hospitals is also crucial. The important hospitals in your vicinity, which you are likely to visit in case of a health emergency, should be in the insurer’s network for you to access cashless treatment.

During the review, understand how much waiting period is left for your pre-existing conditions.

 

When should you port?

 

According to Dubey, you should consider porting if you have had a dissatisfactory experience with your current insurer at the time of claim settlement and policy servicing. An exorbitant increase in premiums should also lead to porting.

Yadav suggests porting when you can get better benefits or lower premiums from another health insurer. “If you are moving to a different city where the current insurer has limited network hospitals, then too you should port,” says Yadav.

Insurers tend to revise policy terms and conditions periodically. “If any of the changes affect your benefits or do not align with your expectations, think of porting,” says Dubey.

He adds that the new insurer must be informed at least 45 days before renewal to initiate the process.

While reviewing the policy, check your health insurer’s claim settlement ratio to ensure it is on the higher side.

A family member may have lost their group insurance coverage. In that case, consider including that person in the family floater plan. Similarly, if your child has crossed the age of 25, move them out of the family floater and into an individual plan (the age up to which children are allowed to stay in the family floater ranges from 25 to 30 across plans).

 

Why purchase a Critical Illness Plan?

 

• While a basic hospitalisation policy covers treatment costs, a critical illness plan provides a lump sum on diagnosis that can help address broader financial needs
• Critical illnesses often require a prolonged period of recovery or may lead to permanent loss of earning capacity; this plan offers financial stability in such situations
• Standard health insurance may not cover non-medical costs like assisted living, rehabilitation, or home care, which a critical illness plan can provide for
• Ensure the illnesses covered align with your family medical history
• Understand the survival period clause: the time for which the patient must survive after diagnosis before the payout is made