In the absence of an individual health cover, moving on from your current employer could leave you stressed about not having any medical insurance, and rightfully so.
Depending only on the company’s health insurance has its drawbacks, especially when you’re between jobs, or been laid off, or wish to take a sabbatical.
What many do not know is that you can convert your company’s health policy to an individual or family cover.
According to the Insurance Regulatory and Development Authority of India’s (IRDAI) Health Insurance Regulations, 2016, employees covered by a company’s group insurance policy can migrate to an individual or family cover.
The start date of an employee’s group policy will be considered for ascertaining waiting period credit for pre-existing illnesses or for certain ailments (such as hernia or cataract surgeries) that are not covered in the first policy year in many cases.
Understanding how group insurance works
When a company buys a group insurance plan, a master policy is issued to the employer and all the employees become a part of the group policy.
Each employee is given a health card with all the necessary details. Based on the plan opted for by the employer, employees may have an option to add members of their family, including parents.
In most cases, the employer bears the premium for the employee, spouse, and children, but may ask the individual to contribute if parents are to be added.
The policy covers the entire group for a period of one year, after which the employers need to renew the plan. In case the employers are unhappy with the existing insurer, they can explore other options at the time of renewal.
It is important to remember that once your employment with the current employer ends, you will no longer be covered under the company’s health policy.
Porting from group to individual cover
However, individuals, including family members covered under a group insurance plan, can migrate to an individual or family health insurance policy with the same insurer.
In such cases, you are required to apply to the insurance company to port the policy at least 45 days before your last working day with the employer. In case you’ve not initiated the process, you get a window of five additional days after your last working day to intimate the insurer about your decision to migrate to an individual or family policy.
Note that the portability option is applicable to the sum insured that was opted for under the group policy, though you could request the insurer to enhance it.
The insurer may ask for additional information before issuing you an individual or family policy. However, it’s the insurer’s prerogative whether to issue the policy or not, and how it wants to price it, based on its underwriting guidelines.
Benefits transfer
When you migrate to an individual or family policy from a group plan, the time you have already spent under the various waiting periods will also get transferred, which means that you are not required to repeat the same again before filing a claim.
Also, according to IRDAI’s porting guidelines, if the waiting period for a certain disease or treatment under the individual or family policy is longer than under the group policy, then the insurer is required to explicitly explain the additional waiting period to the policyholder at the time of porting.
At the time of porting, individual members under the group policy are allotted waiting period credits based on number of continuous years of coverage. This is regardless of whether or not the group cover had any pre-existing disease and time-bound exclusions.
While there exists an option to port from a group to an individual or family health policy, it’s advisable to have personal medical insurance with adequate cover, in addition to your employer’s plan.
This will ensure that you and your dependents have continuous coverage regardless of any turbulence on the job front. This will also lower the effort and ambiguity around migrating from a group to an individual or family policy.
