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PSU insurers withdraw no-claim bonus benefit on health insurance: Should you port your policy?

Policyholders are starting to feel the pinch of steadily increasing health insurance premiums. To make matters worse, some PSU insurance providers are withdrawing benefits such as no-claim bonus (NCB) and family bonus. However, there has not been any major exclusion by private insurers in terms of extended benefits of NCB and family cover discounts. So should you switch? Here are the pros and cons.

Should you port your policy?

Private insurance companies like Aditya Birla Health Insurance and HDFC Ergo General Insurance provide NCB and family discount in floater for more than two or more individuals. Similar benefits are offered by Cigna TTK and SBI General insurance.

While porting is always an option, there are a few issues to consider. Subramanyam Bhrahmajosyula, Head, Underwriting Reinsurance, SBI General Insurance, says, “Keep in mind that the company you’re porting to is not obliged to match the premium or benefits of the expiring policy.” Dinesh Rohira, Founder CEO, of robo advisory firm 5nance.com adds, “While porting, make sure all your benefits are accepted with accrued benefits and pre-existing diseases.”

Steep premiums and no relief for older policyholders

With or without NCB, health insurance premiums are getting uncomfortably high, especially for seniors.


*NA: Medical test is mandatory to get premium quotes.

Note: Premiums are calculated for a health insurance cover of Rs 10 lakh for a non-smoking individual of

sound health with no pre-existing diseases. Premiums are base rates, exclusive of GST.

Source: PolicyBazaar.com

Shreyans Vijay, Co-Founder of Risk Free Life, warns, “Porting just to avail of NCB benefit is not advisable, since it will become pointless if the company you port to decides to withdraw NCB as well.”

Senior citizens worst hit

Rohira says, “There has been hike in the premium due to rising cost of healthcare and increasing rate of specified diseases.” Dhruv Sarin, Head of Health Insurance, Policybazaar.com adds, “Earlier, the average claim size was Rs 30,000, but now it has increased to Rs 60,000. Also, medical inflation is increasing by 12-15% every year, leading to an increase in the cost of premium.” Senior citizens have been hit the worst because claims are higher among those above 60, so premiums have been hiked more steeply for customers in this age group.

For individual above 50, it makes more sense to switch to a policy with NCB benefit as premiums are only marginally higher, and the additional benefit can be very useful.

How to port

As per IRDA guidelines, in order to port your policy to a different insurance provider, you have to write to your old insurance company, requesting the shift and specifying the insurance company to which you intend to awitch, at least 45 days before the policy is due for renewal. So make sure you make the decision to port well before the expiry of your policy.

Article source: https://economictimes.indiatimes.com/wealth/insure/psu-insurers-withdraw-no-claim-bonus-benefit-on-health-insurance-should-you-port-your-policy/articleshow/62304939.cms

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