A few months ago, one of my clients faced an unexpected crisis. His wife had fractured her leg and needed surgery, which meant a longer hospital stay. While he was relieved that they had medical insurance, his relief quickly turned into shock when he realized that his policy had capping limits on room rent, doctor consultations, and other expenses. As a result, his reimbursement was far less than what he actually had to pay.

This was a rude awakening for him. He had been paying an annual premium of Rs. 43,000 for a family of four, with a sum insured of Rs. 5 lakhs. Yet, when he needed the policy the most, it fell short. Fortunately, we had set aside an emergency fund, which helped him manage the additional expenses. However, the core issue remained—his insurance policy was not strong enough to cover his needs due to the wrong selection.

With medical costs rising at an annual rate of 12-15%, having an inadequate insurance policy can be a costly mistake. And, this is a very common mistake that people make. Thankfully, this is a mistake that can be rectified. Let’s see how.

Common Mistakes in Insurance Policy Selection

The main reason behind the wrong selection for my client was his lack of awareness while selecting his policy. He had purchased it from an extended family member, without thoroughly reviewing the policy documents.

Many people make similar mistakes:

• Buying insurance from friends or relatives without verifying the details
• Choosing a policy based only on premium amount or brand reputation
• Overlooking key details like coverage limits, waiting periods, and exclusions

When I had previously asked him to share his policy details, he brushed it off, trusting his relative instead. Fortunately, he had listened to my advice to maintain a contingency fund as an additional safety net.

How to Fix a Poorly Chosen Insurance Policy

After this incident, I insisted on reviewing his insurance policy. A detailed review confirmed that his current plan wasn’t suitable for his needs. That’s when I suggested an alternative—porting his insurance policy.

His immediate reaction was, “Can I really do this? Won’t I lose my existing benefits?”

Understanding Insurance Policy Porting

Porting an insurance policy is similar to porting a mobile number—you switch to a new service provider without losing your existing benefits. This means that when you transfer your insurance policy from one insurer to another, you retain benefits such as waiting periods for pre-existing conditions and no-claim bonuses.

This was a huge relief for him, but he had another question—“How do I do this?”

Steps to Port Your Insurance Policy

If you’re in a similar situation and want to port your health insurance, here’s what you need to know:

1. Apply Within the Right Time Frame

You must apply for porting at least 45 days before your policy renewal date. This gives the new insurer enough time to assess your application and review your medical history.

2. Gather Necessary Documents

You need to submit policy documents for the last three years. If your policy is newer, provide at least two years of records. If it’s just a year old, KYC documents will be required.

Additionally, disclose all pre-existing ailments, including those of your family members if you have a family floater policy. And, this is a very important thing to do.

3. Inform Your Current Insurer

You must notify your existing insurance provider in writing—either via email or a formal letter—about your intention to port your policy.

4. Waiting Period & Approval Process

Once your application is submitted, the new insurer has 15 days to inform you of their decision. If they fail to respond within this period, they are required to accept your request by default.

Final Thoughts

Choosing the right health insurance policy is crucial. It should be based on your specific needs, not just brand names or premium costs. However, if you realize that your current policy isn’t the right fit, porting is a great way to switch insurers without losing your benefits.

Just remember to initiate the process on time, submit the required documents, and be transparent about any medical history. By doing so, you can ensure a smooth transition to a better insurance plan that truly protects you and your family.