Ported Health Policies Get Legal Protection

The Bombay High Court (BHC) has clarified that once an insurer accepts a health insurance portability request and collects the premium, it cannot later reject claims on grounds such as non-disclosure or internal system lapses. The ruling underlines that portability is not just a procedural facility but a statutory right, and insurers must honour the responsibilities that come with accepting a migrated policy.

“Once a new insurer accepts a portability request and collects the premium, the policyholder gains legitimate claim security under the migrated policy,” says Narendra Bharindwal, president, Insurance Brokers Association of India (IBAI).

“Regulations by general Insurers and health insurers, while offering the option of portability to the insured. Schedule- 1 casts an obligation on the existing insurer to provide the requisite data to the new insurance company, upon which the new insurance company may underwrite the proposal and convey its decision to the policyholder. If the decision is not conveyed within 15 days, the new insurer loses the right to reject the proposal,” says Supriya Majumdar, partner, Elarra Law Offices.

The ruling makes it clear that insurers can’t go back later and reject claims citing non-disclosure or internal lapses if they had the chance to check everything before issuing the policy. For policyholders, this offers reassurance that changing insurers — often for better service, price or cover — won’t suddenly lead to claim uncertainty later.

Due Diligence Must Precede Premiums

The ruling puts the responsibility for proper underwriting squarely on the new insurer. If portability is accepted and the premium is taken, the insurer is assumed to have already checked medical disclosures, past policy details, and risk factors before issuing the policy. Insurers cannot later shift responsibility to the policyholder by citing system errors, incomplete internal review,s or delayed underwriting processes.

“In practical terms, this means insurers must strengthen their pre-acceptance checks, improve coordination with previous insurers for data sharing, and ensure underwriting decisions are taken upfront, not revisited at the claims stage,” says Bharindwal. Transparency, timely communication, and documented underwriting decisions will become even more critical.

Ported Policies Get Stronger Claim Protection

The judgment thus protects the policyholders from unjustified rejection of claims on the ground of incomplete disclosures after the policy is ported to a new insurance company, and rather places the burden on the insurers to be more vigilant in respect of the information collection from the existing insurance company and make an informed and timely decision.

“The case reflects how the insurance companies accepting migration of policies ought to rather weigh their option of rejecting the proposal when there is any doubt on the completeness of the information supplied to them, as there is no room for rejecting the claim on the ground of incomplete disclosures or information on the claim history of the policyholders,” says Majumdar.